UBS sees euro at $1.40 in a year

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But such apparent calm has not prevented some forecasters from predicting huge swings ahead for the dollar.

UBS, for example, the most bearish dollar forecaster on the FX Week Currency Forecasts Index, sees the euro at 1.40 and cable at 2.05 in 12 months' time. Pronet Analytics predicts a more modest euro/dollar rate of 1.32 – but has a more extreme view of 2.09 on cable.

For UBS's global economist, Paul Donovan in London, it's a simple dollar-negative story. "It's the fundamental imbalance of t