EUR/USD seen trading back down at 1.07 on a three-month view.

EUR/USD pair to lose ground toward 1.07 before bouncing back higher.USD hurt by soft landing outlook

Disinflation has hurt the USD with US interest rate expectations tilting towards interest rate cuts rather than interest rate hikes. Falling inflation has also lifted risk sentiment. That has not been supportive for the USD, a traditional safe haven, that benefits when there is risk-off.

The USD is likely to perform again when the probability of a soft landing fades and risks of higher interest rates for longer prevail. Our three-month forecast has.EUR/USD trading back down at 1.07 before pulling higher.

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