In a client note out to customers RBC said they see the dollar stronger against most majors 12 months from now and they reckon the Fed will be the first of the big four central banks to tighten.

  • AUD/USD 2013 Q4 forecast revised to 0.98 from 0.88, Q4 2014 0.94 vs 0.90 prior
  • NZD/USD 2013 Q4 0.88 vs 0.79. Q4 2014 0.84 vs 0.81
  • USD/CAD 2014 Q4 1.09 vs 1.02

Shorter term they still see the possibility of EUR/USD higher despite the threat of further rate cuts and possible negative deposit rates. A stable ECB policy outlook would negate euro weakness and see the pair trade a 1.30-1.37 range.