Will the euro rise more?

Will the euro rise more?
Apart from the structural flaws inherent in the euro, driven largely by the distinct characteristics of Eurozone member countries, there is a clear market-related reason why I believe the euro is too expensive relative to the dollar.

Short-term movements in currency pairs are explained by (changes in) interest differentials. If interest rates are higher in the United States, allocating money there is more attractive than in the Eurozone. This results in an appreciation of the US dollar, everything else equal.

So, when the interest rate differential moves, so does the EURUSD exchange rate. Based on the current differential, the EURUSD exchange rate should be around 1.06, not 1.18. Fair, the Federal Reserve has much more room to cut rates, as the ECB has already cut them in half to 2.0%. Yet, even allowing for two interest rate cuts by the Fed this year does not offer much room for further euro appreciation from this angle.

US dollar policy is in the spotlight now, causing the dollar to weaken. This does not erase the fact that the euro is currently overpriced, structurally flawed, and part of an intrinsically weak economic block that is aging rapidly, lacking competitiveness and innovation.