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Factbox-Wall Street forecasts for the U.S. dollar and 10-year Treasury yield in 2022 -Breaking


© Reuters. FILE PHOTO A Wall Street street sign can be seen at the New York Stock Exchange (NYSE), New York City, New York. It was taken on January 3, 2019, by Shannon Stapleton. REUTERS/Shannon Stapleton

NEW YORK (Reuters] – Wall Street banks began to publish their projections for 2022 in relation to euro/dollar, dollar/yen and benchmark.

Below is an overview of the forecasts.

Bank Euro/dollar Dollar/yen U.S. 10-year

Treasury yield

Barclays (LON:) $1.19 115 yen 1.75%

Morgan Stanley (NYSE:) $1.18 118 yen 2.1%

Goldman Sachs (NYSE:) $1.18 111 yen 2.0%

JP Morgan $1.12 114 yen 2.10%

(end-Sept 2022)

Wells Fargo (NYSE:) $1.10-$1.18 110-120 2.00-2.50%

Placement

Institute

Barclays

Dollar: “We anticipate modest U.S. currency depreciation during the coming year. It reflects our views on a positive backdrop to risk and commodities along with moderate U.S.dollar overvaluation. Risk-off movements are more important than U.S. underperformance. The downside risks from U.S. aggressive market pricing and tighter Fed policy have a smaller impact on upside.

Morgan Stanley

U.S. 10-year yields

Dollar vs. euro and yen: We see an upward-and-down trend for the U.S. dollars. The Fed emphasizes that the maximum employment rate is still a ways off and that any subsequent increases post-liftoff will likely be gradual, despite improved data. This contrasts with central banks that, having been very dovish, have begun to consider normalization plans. The U.S. dollar falls as a consequence of policy convergence becoming policy divergence.

Goldman Sachs

Dollar: We have lowered our 12-month forecast from $1.25 to $1.18.

JPMorgan (NYSE:)

Dollar: Policy repricing continues amid an ongoing supply-side inflation shock. For some currencies, the theme of Monetary Policy Divergence is still a concern. Developments in the U.S. — a more open-minded Fed on inflation and a tight labor market report—are supportive of U.S. dollar longs against the euro and yen.

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Mike Robinson
Mike covers the financial, utilities and biotechnology sectors for Street Register. He has been writing about investment and personal finance topics for almost 12 years. Mike has an MBA in Finance from Wake Forest University.