[LFX]

Short term (up to 1 month)
��The USD is likely to remain under pressure but short covering into year end and lingering risk aversion will limit the downside.
��NZD, NOK, SEK and AUD are likely to register the strongest performances in the short-term though their gains may be limited into year end due to profit taking/position squaring.
��The JPY is finally reacting to official concerns and intervention threats and will underperform, likely gyrating around the 88-90 level before weakening into 2010.

Medium term (beyond 1 month)
��Interest rate differentials will increasingly overtake risk aversion as the main FX driver.
��The USD will remain under pressure early in 2010 but will see some recovery in H210.
��The biggest FX gains will be registered in yielding commodity currencies especially in H110.
��EUR/USD will decline from Q1 onwards as economic and banking sector concerns weigh.