A Wall Street sign is pictured outside the New York Stock Exchange amid the coronavirus disease (COVID-19) pandemic in the Manhattan neighborhood of New York City, New York, the United States on April 16 2021. REUTERS / Carlo Allegri / File Photo

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Nov. 18 (Reuters) – Banks on Wall Street have started releasing their guidance for the end of 2022 for the euro / dollar, dollar / yen and the benchmark 10-year U.S. Treasury yield.

Here’s a summary of their predictions:


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Dollar: “We expect the US dollar to weaken slightly over the coming year, reflecting our view of a positive environment for risk and commodities as well as a moderate overvaluation of the US dollar. resulting from aggressive market pricing for tighter Fed policy. “

Morgan stanley

US 10-year yields: “Strong growth continues in 2022, alongside declining inflation but above target, is keeping the Fed patient, while moving gradually towards rate hikes, and maintaining Treasury yields. on the rise. “

Dollar vs. Euro and Yen: “We see a top-down profile for the US dollar. A Fed pointing out that peak employment is far away and that subsequent hikes after take-off are likely to be gradual despite improving data is likely to contrast more and more with other central banks which, having been fairly accommodating so far , begin to discuss their own standardization plans. Policy divergence increasingly becomes policy convergence, and the US dollar falls in response. “

Goldman Sachs

Dollar: “While the broad dollar is likely to fall more than rise over the medium term, for it to actually depreciate, structural and cyclical drivers need to align, and we are now less sure that will be the cases in the coming year. … We have revised our 12-month EUR / USD forecast down to $ 1.18 from $ 1.25 previously. “

JP Morgan

Dollar: “The price review in the context of the ongoing inflationary shock on the supply side continues. The divergence of monetary policies remains a theme for some pairs. Developments in the United States – a Fed more open to inflation and a tight labor market report – are supporting the dollar being long against the euro and the yen.


Dollar: “While acknowledging that there is little the Fed can do to surprise market expectations, but disappoint at this point, we see the sequence of slowing global growth and the Fed starting its modest political normalization remaining, in overall, positive for the US dollar. “

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Reporting by Gertrude Chavez-Dreyfuss; Editing by Alden Bentley and Jonathan Oatis

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