International highlights
The dollar gains ground amid tensions
The EUR/USD pair has depreciated by -0.71% this week to reach 1.1784. The dollar traded in an environment marked by generally solid economic data and a tense geopolitical context, posting its best performance since November 2025. On the one hand, new jobless claims in the United States fell to 206K from 229K a week earlier, confirming the resilience of the US labor market. On the other hand, persistent tensions between the United States and Iran reinforced the USD appeal as a safe-haven currency. In this context, market expectations have adjusted in favor of a postponement of the Fed's rate cut schedule in 2026.
MAD evolution and foreign exchange market liquidity indicators
The basket effect is favorable to the Dollar this week
The USD/MAD pair appreciated by +0.31%, rising from 9.14 to 9.17 this week. This change is primarily due to an unfavorable basket effect of +0.51% for the MAD, linked to the appreciation of the dollar on the international market this week. The liquidity effect, unable to offset the basket effect trend, was -0.20%, reflecting a gradual easing of liquidity conditions in the interbank foreign exchange market. In this context, liquidity spreads narrowed by -19.3 BPS to 2.84% this week.
Volatility indicators
Geopolitical risks and increased caution
Uncertainty surrounding the European Central Bank (ECB) president's term continues to weigh on the euro, while markets remain sensitive to the resurgence of geopolitical tensions, particularly regarding a possible renewed conflict between the United States and Iran. In this context, higher volatility is expected in the forex market. We therefore recommend that traders hedge their positions over a 1- to 3-month horizon.
EUR/USD outlook– BLOOMBERG
Brokers have revised their long-term forecasts for the EUR/USD pair upwards this week. The pair is expected to trade around 1.19 in Q1-26 and Q2-26. In Q3-26 and Q4-26, it is projected to continue its upward trend to 1.20 before reaching 1.21 in 2027. For the 2028-2029 period, the target is now 1.23 for 2028 and 1.25 for 2029, compared to 1.21 and 1.23 respectively a week earlier.
The latest minutes of the FOMC meeting reinforced expectations of a continued restrictive monetary policy stance in 2026, amid heightened geopolitical tensions, particularly fears of escalation between the United States and Iran. Domestically, new weekly jobless claims fell by 23K to 206K, reflecting the continued resilience of the US job market. Against this backdrop, markets continue to forecast two rate cuts this year, each of -25 BPS, with the first easing now expected in July, followed by a second in October, according to the CME FedWatch tool.
In the Eurozone, uncertainties surrounding the ECB presidency are fueling debates about the future orientation of monetary policy, against a backdrop of mixed economic indicators. The February manufacturing PMI exceeded expectations by returning to expansion territory [50.8], while the decline in the ZEW index to 39.4 reflects a weakening of sentiment, with markets still anticipating a monetary policy status quo in 2026, according to the ECB Watch tool.
We maintain our 1 month 2 months and 3 months horizons forecasts
Considering the EUR/USD parity forecasts and liquidity conditions in the foreign exchange market, we have maintained our USD/MAD pair forecasts for the 1 month, 2 months and 3 months horizons.
Brokers' EUR/USD parity forecasts suggest a slight appreciation of the Euro against the Dollar over a 3-month horizon, compared to spot levels.
Liquidity spreads for the dirham should, meanwhile, gradually tighten over a 1 month, 2 months and 3 months horizon compared to spot levels.
Under these conditions, the target levels of the USD/MAD parity are:
- 9,25 at 1 month
- 9,26 at 2 months
- 9,31 at 3 months
compared to a spot rate of 9.17
The target levels for the EUR/MAD exchange rate are:
- 10,80 at 1 month
- 10,82 at 2 months
- 10,88 at 3 months
against a spot level of 10.79.
