Dr. Gil Feiler, CEO of Info Prod Research and author of both Investing in Russia and Rethinking Business Strategy for the EIU, predicted on Thursday bearish outlook to the USD against major currencies Feiler explains that major central banks would like to reduce their exposure to the greenback and to diversify away from US Treasury bonds. Today, 71 percent of the currency composition of the reserves in the advanced economies are held in USD while at the emerging economies 63 percent  are held in USD. Changes in the composition of the USD in the total reserves of the central banks would reduce the holdings in USD and the green currency will be pressured. Nevertheless, the USD will remain the major global reserve currency for the short and medium term. Dr. Feiler estimated that the Euro will rise to USD 1.47 by the end of 2009 against 1.3162 Thursday. The GBP will rise to 1.69 by the end of 2009 against 1.4855, and the Japanese Yen per USD will slightly strengthen to 101 against 98.8 currently.
 
As for the fixed income. Dr. Gil Feiler forecasts a moderately decline in the USA bond yields. According to his estimation the 10 years Government Bond Yield will  be 2.9 percent by the end of 2009 while the 30 years Government Bond Yield will  be 3.55 percent by the end of 2009. Feiler sees no no inversion curve for 10 years - 2 years or 30 years – 10 years by the end of 2010.
 
As for the Fed Funds Target Rate, Feiler said that the fed fate of 0 percent will stay with no change during at leas up to the end of the first Q of 2010.