Bank of America Global Research highlights the key findings from its latest FX and Rates Sentiment Survey.

"Respondents aggressively covered USD shorts on the outbreak of the war in Iran. Since the last survey, positions and views are broadly unchanged. This reflects that investors view the Iran war as more of a level shift to the USD path for 2026 than a change in the trend," BofA notes.

"Continued USD bearishness is driven by growth concerns dominating inflation worries. And for example, investors remain convinced that the Fed will err on the dovish side," BofA adds.