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Jul 21 - 09:55 AM

USD: 'We Have Not Been Bullish Enough'; Now Targeting EUR/USD At Parity By End Of Q3 - BofA

By eFXdata  —  Jul 21 - 09:17 AM

Bank of America Global Research discusses the USD outlook and revises its EUR/USD forecasts down to 1.00 by end of Q3.

USD has continued to persist on the stronger side as major central bank action approaches with the ECB and the Fed. Higher inflation has led to further Fed action, as the data have unpleasantly surprised to the upside, previously pushing the Fed into a 75bp rate hike back in June, and provoking the possibility of a 100bp rate hike at the FOMC next week. Still, increased recession concerns have clouded expectations of longer-term future moves, and our US Economics team recently shifted their base case for recession this year," BofA notes. 

"Ultimately, we still look for further USD strength near-term, including pushing our end-3Q EUR-USD forecast to 1.00. However, most of our FX outlook remains unchanged, including keeping our year-end EUR-USD forecast of 1.05, and looking for some retreat in the USD in 2023," BofA adds. 

Source:
BofA Global Research

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