Analysts from Rabobank consider the US dollar’s upside has further to run in the first half of 2022 and they maintain a 6 month price forecast for EUR/USD of 1.10.

Key Quotes: 

“We remain constructive on the outlook for the USD, at least through the first half of the year. Aside from supportive interest rate differentials, the USD may be a beneficiary of safe-haven flows in the weeks ahead connected to the news-flow regarding a possible Russian invasion of Ukraine. That said, the bullish USD view is not without risks, particularly in the latter months of 2022.”

“Given that the market is short EURs, a renewed focus on the outlook for a change in direction for ECB policy could trigger a move higher in EUR/USD.”

“We expect EUR/USD can move to the 1.10 area by the middle of the year. However, we see risk that the USD could struggle to add to these gains in the latter part of 2022 and see a return to the 1.12 area on a 12 month view.”

This article was originally published by Fxstreet.com.Read the original article here.

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