For the first time since 2002, the dollar and euro are on the verge of being equal.
A Bullish Dollar Outlook
The euro (EUR) has lost nearly 14% against the dollar (USD) in the past year and is far below its March 2008 peak of roughly $1.58.
In addition to fundamentals and technical factors, market psychology and geopolitical risk influence the dollar and euro’s value on the world market.
The dollar is expected to reach its peak by around the third quarter of 2022 before starting to trend lower.
Macroeconomic conditions in the past month have become even more conducive towards a bullish USD outlook.
While the war in the Ukraine has created bleak economic prospects for Europe, it has had a far lesser impact on the US economy.
The USD’s status as a safe haven has been boosted by higher inflation and a hawkish Federal Reserve (Fed).