The US dollar's strength is forecasted which we expect to appreciate by more than 5% in REER terms over the next 12 months even though the Fed delays its lift-off. On this stronger USD outlook, we also project the EUR to remain investors' preferred short. The recent moves in FX crosses have left the EUR REER only 4.5% cheap relative to fair, and we look for EUR REER to depreciate by another 11% in the next 12 months.
On the flip side, the ECB is set to expand its QE program soon, pressured by weaker global growth, a softer inflation outlook, and tighter domestic financial conditions. We forecast EURUSD at 1.03 by year-end and 0.95 in 12 months. in addition to that we also expect the CHF to attract attention, as we expect the uptrend in EURCHF to be sustained.
Short EURUSD spot under tighter monetary conditions, falling commodity prices and an increase of the risks to foreign growth have reduced the near- and medium-term inflation outlooks as breakevens have fallen anew to near recent lows. We think that EURUSD will resume its downward trend based on our expectation of further monetary easing before year-end.


How will the Iran war change the Middle East? We asked 5 experts
Meta and Google just lost a landmark social media addiction case. A tech law expert explains the fallout
Makemation: a Nollywood movie that shows AI in action in Africa
Strait of Hormuz Disruption Sparks Global Oil Supply Fears
Gold is meant to be a ‘safe haven’ in uncertain times. Why is it crashing amid a war?
Time to buy local: war fuel price shocks reveal the folly of a long food supply chain
How the war in Iran is already affecting UK farmers and food production
RBC Capital: European Medtech Firms Show Minimal Middle East and Energy Risk Exposure
Will a new border deal with the US open a backdoor into Kiwis’ personal data? 



