The euro has been on fire lately, today threatening to break solidly above $1.26.
But pay no mind to that. According to the world’s top analyst (and several who are close), the euro is still bound to tank.
Shaun Osborne, chief currency strategist at TD Securities Inc. in Toronto, said the euro will depreciate to $1.13 in the third quarter, $1.08 by year-end and may near $1 in 2011 before recovering. Osborne, whose predictions were within 4.1 per cent of the mark on average, according to data compiled by Bloomberg, was echoed by the nine following most-accurate forecasters anticipating a lower euro in the next two quarters.
For what it’s worth, we suspect there’s a lot of trend-following and herding going on here, and that if the euro were to continue its run, we’d see these projections change pretty quickly.
Even before this recent spike, there’s clearly been a change in investor sentiment, as major names have revealed themselves as euro bulls (Jim Rogers is a good example of one).