USD: Attractive Buy Levels; Upside Risks Related To US Tax Reform Still Underpriced - BofAML

Bank of America Merrill Lynch Research discusses the USD outlook and remains broadly bullish on the currency through Q1 and believes that the USD is currently trading around attractive entry levels for longs.
"Within a backdrop of constructive near-term fundamentals, we continue to think that upside risks related to the US tax reform are underpriced.
Successful passage of tax reform should add to already-solid US growth and prompt a wave of repatriation activity by US corporates; however, updated Fed projections (which now incorporate fiscal stimulus) suggest that upside risk to Fed Funds from the direct result of a tax bill appears limited at this point. This probably moderates the upward potential of US-RoW (rest of world) interest rate differentials but does not alter our core USD view.
Positioning remains broadly short the dollar and there remains scope for the rates market to re-price to the Fed dot plot. These still represent important upside risks," BofAML argues.