Investing.com - Analysts at Goldman Sachs (N:GS) on Monday abandoned their prediction that the euro would fall below parity with the dollar next year, after the latest round of European Central Bank stimulus measures fell far short of market expectations.
Goldman said it now believes the euro will be trading around $1 in a year’s time and not at 95 cents, as it previously expected.
The bank revised its forecast for the euro-dollar pair to $1.07 in three months, $1.05 in six months and $1.00 in 12 months from $1.02, $1.00 and 95 cents previously.
It also raised its end-2017 forecast from 80 cents to 90 cents.
Goldman said its previous certainty that the ECB will do whatever it takes to generate inflation has weakened.
The single currency posted its largest one-day gain against the dollar in more than six years on Thursday, jumping 3% after the ECB kept the pace of its asset purchase program unchanged at €60 billion per month, disappointing expectations that it would speed up its bond-purchasing scheme.