Euro Firmer Against Dollar Despite BNP Paribas Downgrading Growth

Strategists at BNP Paribas have lowered their Eurozone growth outlook, seeing GDP expansion decelerating to 0.8% in 2026 from 1.5% in 2025. They cite negative spillovers from the Middle East conflict and an unspecified set of other headwinds.

Despite the downgrade, the euro has firmed against the US dollar. The move suggests that traders may be looking past near-term growth concerns, potentially focusing on the European Central Bank’s policy path or US dollar weakness.

The note did not provide a revised EURUSD forecast, but the call comes at a time when the pair is testing recent resistance levels.