Sunday, 20 December 2015

Deutsche Bank: The strengthening of the dollar will continue for another two years

According to Alan Ruskin and George Saravelos, FX strategists at Deutsche Bank, multiannual cycle of the strengthening of the dollar will continue for another two years.

For the period we expect, that the dollar index, which measures the performance of the "green money" against a basket of six other currencies to rise by another 10%.

What lies ahead in 2016 depends mostly on where will focus the attention of the investors. If they rely on Fed policy, the rise of the dollar is likely to be slow and wide, spreading evenly to the currencies of the Big Four, commodity currencies and currencies of developing countries.

If, however, the spotlights go onto China and its monetary policy becomes a source of instability, the dollar will advance more against commodity currencies and currencies of developing countries, than against its competitors from developed countries.
Against this background, by Deutsche Bank adjusted upward its forecast for EUR /USD rate at the end of 2016, expected levels of $0.95 with $0.90 previous forecast.


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