Bank of America Merrill Lynch FX Strategy Research discusses the USD outlook, outlining some key reasons on why the greenback is not trading at stronger levels.
3- The strong consensus remains that the tax reform will be difficult to approve and in any case will be light on its macro and market impact.
4- The official sector has been consistently selling the USD since spring, primarily against EUR and JPY, according to our flows," BofAML argues.
"... What happens next depends on the chances of US tax reform, in our view," BofAML adds.
BofAML maintains a short EUR/USD* position targeting 1.15.