Forex Flash: EUR/USD seen at 1.2600 in 3 months - UBS

FXstreet.com (Córdoba) - Eurozone GDP data for the first quarter was weaker than expected, showing a contraction of 0.2% QoQ after a drop of 0.6% QoQ in 4Q12, notes the UBS analyst team. "Rather disappointing German GDP growth of only 0.1% qoq contributed to this negative surprise".

"The EURUSD fell below 1.29 on the news. If anything, the very slow stabilization into the second half of the year should increase the ECB's focus on more accommodative monetary policy measures", UBS comments. "We thus keep our EURUSD forecast at 1.26 in 3 months".