25 Feb 2015
With June hike on table, USD to strengthen over the coming 3-6 months – Danske
FXStreet (Barcelona) - Allan von Mehren, Chief Analyst at Danske Bank, explains that with Yellen signalling towards a probable June rate hike by the Fed, USD might strengthen in the coming 3-6months, forecasting EUR/USD at 1.10 and USD/JPY at 125 in 6 months.
Key Quotes
“We expect ‘patience’ to be removed in March to give the Fed flexibility to hike in June.”
“We also continue to look for a hike in June based on continued robust employment gains and decent GDP growth rates. Risks are, however, still skewed towards a hike later (July or September).”
“Yellen’s testimony and our view that the Fed will begin lift-off in June supports our call of a broadly stronger USD over the coming 3-6 months.”
“In our view, the USD should strengthen as long as we are waiting for the first rate hike, particularly versus currencies which are backed by ultra-loose monetary policy, such as EUR, JPY, CHF and SEK.”
“We forecast EUR/USD at 1.12 in 1M, 1.11 in 3M and 1.10 in 6M, with USD/JPY expected to shoot higher to 120 in 1M, 124 in 3M and 125 in 6M.”
Key Quotes
“We expect ‘patience’ to be removed in March to give the Fed flexibility to hike in June.”
“We also continue to look for a hike in June based on continued robust employment gains and decent GDP growth rates. Risks are, however, still skewed towards a hike later (July or September).”
“Yellen’s testimony and our view that the Fed will begin lift-off in June supports our call of a broadly stronger USD over the coming 3-6 months.”
“In our view, the USD should strengthen as long as we are waiting for the first rate hike, particularly versus currencies which are backed by ultra-loose monetary policy, such as EUR, JPY, CHF and SEK.”
“We forecast EUR/USD at 1.12 in 1M, 1.11 in 3M and 1.10 in 6M, with USD/JPY expected to shoot higher to 120 in 1M, 124 in 3M and 125 in 6M.”