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Bank of America

FX Outlook 2026: Structural Dollar Headwinds

LIVE5 December 2025USD bearish

Overview Forecasts Trades Currencies Scenarios Technicals Volatility EM Strategy Macro Quant

Currency Views

Bank of America per-currency outlook with bias, key drivers, live rates, and forecast targets

19 currencies shown

EUR/USDQ1: 1.17 → Q4: 1.22

•German fiscal expansion

•Narrowing Fed-ECB spread

USD/JPYQ1: 154 → Q4: 147

•BoJ rate normalization

•Carry unwind risk

GBP/USDQ1: 1.34 → Q4: 1.40

•Fiscal clarity

•BoE hawkish hold

↑ Moderately Bullish

USD/CHFQ1: 0.80 → Q4: 0.76

•Safe haven demand

•SNB rate floor

EUR/NOKQ1: 11.30 → Q4: 10.72

USD/NOKQ1: 9.95 → Q4: 9.35

•High G10 yield

•Cheap valuations

EUR/SEKQ1: 10.60 → Q4: 9.90

USD/SEKQ1: 9.25 → Q4: 8.65

•European fiscal spillovers

•Rate sensitivity recovery

AUD/USDQ1: 0.66 → Q4: 0.70

•RBA higher for longer

•Commodity demand

NZD/USDQ1: 0.57 → Q4: 0.60

•RBNZ deep cuts

•Growth recovery

↓ Moderately Bearish

USD/CADQ1: 1.39 → Q4: 1.35

•USMCA renegotiation risk

•BoC easing cycle

DXYQ1: 97.5 → Q4: 93.5

•Twin deficit deterioration

•Fed easing cycle

USD/CNYQ1: 7.00 → Q4: 6.85

•PBoC managed appreciation

•Trade surplus

USD/MXNQ1: 18.10 → Q4: 17.30

•Nearshoring flows

USD/TRYQ1: 45.00 → Q4: 51.00

•Managed depreciation

•High carry offset

USD/ZARQ1: 16.80 → Q4: 15.80

•Commodity terms of trade

•GNU stability

USD/PLNQ1: 3.55 → Q4: 3.28

•EU fund inflows

•NBP near terminal

EUR/HUFQ1: 370 → Q4: 335

USD/HUFQ1: 320 → Q4: 292

•April election risk

↑ Moderately Bullish

USD/BRLQ1: 5.30 → Q4: 5.10

•October election risk

USD/KRWQ1: 1440 → Q4: 1370

•WGBI inclusion flows

•Tech cycle recovery

↑ Moderately Bullish

USD/INRQ1: 88.00 → Q4: 85.50

•Portfolio flows improving

•RBI policy shift