Will the ECB & BoJ fight back against depreciation?

Although it has dropped back a little today, the US dollar is on track for another strong week, rising further against all other major currencies and hitting a new 20-year high. At the time of writing, the greenback was at or around our end-2022 forecasts against most major currencies. As we discussed here and here, while we are sticking to our existing forecasts for now, the risks are increasingly skewed towards further dollar strength.