Wells Fargo - "The euro has extended its gains in early 2013, reaching its highest level since late 2011. An ongoing improvement in Eurozone bond markets and a shift in the European Central Bank’s rhetoric have driven the euro higher, and are also factors that have reduced our medium term pessimism on the single currency. The underlying Eurozone economic performance remains weak however and does not, in our opinion, naturally lend itself to a sizeable build-up in euro long positions. As a result we still expect the euro to soften over time, although it will probably take a relapse in the economic data or a return to dovish central bank rhetoric for such a decline to occur. We see the euro as little changed at $1.35 in three months, and gradually sliding to $1.28 in twelve months. As a result, we still view the euro’s current levels as a selling opportunity."
3-month 6-month 9-month 12-month 15-month 18-month
1.3500 1.3300 1.3000 1.2800 1.2700 1.2700