Foreign Exchange Forecasts

Citi Research forecasts a short-term tactical USD appreciation driven by hawkish Fed policy and technical bullish breakouts, while maintaining medium-term neutrality as Fed hikes remain non-base case.

Key Takeaways

• 1.We lower our 0-3m EURUSD forecast to 1.13 to reflect USD-positive asymmetry.
• 2.The DXY has started to see a bullish break out of the one-year range.
• 3.We see re-entry into EMFX carry as attractive, with EUR and CHF preferred funders.

Table of Contents

• CITI'S TAKE
• Macro Overview: to chase or not to chase
• G10 FX Overviews
• Select EMFX Overviews
• Appendix Forecast Tables
• Appendix A-1

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