UBS Targets U.S. Dollar at $1.25 Against Euro in Three Months

By Daniel Tilles

Feb. 25 (Bloomberg) -- The dollar may strengthen to $1.25 against the euro in three months, according to UBS AG, the world’s second-biggest foreign-exchange trader.

“The lack of alternatives to the dollar in the current environment is becoming increasingly conspicuous and we continue to target the greenback at $1.25 in three months against the euro,” Ashley Davies, a currency strategist in Singapore, wrote in a report today. UBS repeated it would hedge its “view of either a risk rally or a debasing of the U.S. dollar with a six-month call option on the Australian dollar.”

The dollar was little changed at $1.2851 against the euro as of 7:19 a.m. in London.

To contact the reporter on this story: Daniel Tilles in London at dtilles@bloomberg.net