EUR/USD: euro and dollar forecast for this week (starting 10 August)

As it does every Monday, Morgan Stanley shares its weekly forecasts for the euro and the dollar:

EUR: The pair awaits the revealing of more details in terms of the Fed's projects - bearish opinion

"The euro has been difficult to trade recently, given the problems in Greece and the fact that the ECB is no longer the main concern of the market. We expect the euro to move down gradually as the Fed becomes increasingly optimistic. Indeed, it is our view that US factors that will dominate the euro's direction. The EUR/USD continues to show an inverse correlation with risk appetite, and we will therefore monitor developments in the European equity markets."

USD: A rate hike in September is still possible - bullish opinion

"We are sticking to our bullish opinion of the USD. Recent comments by governor Lockhart suggest that a rate hike in September is still quite possible, which should support the USD. But as the central bank has openly declared that it depends on economic data, we will need to closely monitor the data published during the month of August, and its influence on USD will probably be exacerbated."