Dollar: HSBC analysts made an unexpected forecast

HSBC analysts have published a new forecast for the dollar, which is at odds with the broad consensus that the US currency will go down next year.
According to the bank’s currency strategists, the bullish dollar outlook is based on five myths that they have consistently refuted in their research note.
The expected slowdown in the Fed rate hike in 2019 may not be sufficient for the dollar to fall to a fall, as the rate itself for a long period of time will be higher than the rates of the largest central banks, analysts say.
The effects of a slowdown in the US economy should also be considered. It is important to evaluate not absolute numbers, but relative ones - in comparison with the European economy. And here the advantage of the American economy will remain.
The structural problems of the US economy should also not be overestimated, nor should one agree with the view that the currencies of emerging markets are "undervalued", the weakness of which is associated with objective risks.

Given these circumstances, the dollar still does not look expensive and will strengthen to the end of 2019 to 1.10 dollars per euro, predict in HSBC. The bank's forecast for other currency pairs at the end of next year - GBP / USD - 1.30, USD / JPY - 108.