Stronger Euro at the end of the year?

If the Santa rally is about (global) stocks, then one would expect a stronger EURUSD at the end of the year as well… usually that’s true, but not this time…

Figure 1 shows the seasonality of the EURUSD (counting from 31-Oct to 31-Jan each year).

We are already -4.2% down this year. Figure 2 shows today’s situation relative to the 2014-2023 average. The current year can only be compared to 2016/2017 (Trump’s first win), and 2014/2015 – see Figure 3.

For a more complete picture, let’s have a look at the seasonality of the S&P500 – see Figure 4.

And indeed, you can expect a stronger euro with rising stock prices, unless we are in an election year and Trump wins… see Figure 5 – then stocks rise, euro falls!