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Yes, we do expect this downward trend to continue, due to the unfavourable macroeconomic situation in the Eurozone.
What kind of measures do you anticipate from Mario Draghi, the ECB President, to counter the region's debt crisis?
None, actually. We think the ECB will remain on-hold, but it may launch more Long Term Refinancing Operations, if there will be a necessity. However, currently we do not expect any measures to be undertaken.
What is your EUR/USD forecast for the end of the Q2 and at the end of this year? What will be the main reasons behind the EUR/USD performance in the short and long term?
Our second quarter forecast for EUR/USD is 1.26, as we believe Spain is going to initiate talks to receive a bailout package. Afterwards, we expect a cautious recovery during the second half of this year with EUR/USD appreciating to 1.30. However, by the end of this year we anticipate EUR/USD to trade at 1.28. Therefore, it is currently moving down and then there is going to be slight upward movement. The Euro will weaken on the Spanish bailout package and then we forecast Spain to receive 150 billion Euro aid towards the banking sector that will stabilize the upside gain for the Euro.