FXstreet.com (Córdoba) - EUR/USD at 1.3350/70 is close to the UBS year-end forecast of 1.34 while EUR/CHF and EUR/JPY are also close to the 12 month forecasts (1.23 and 121). "Nevertheless, the exchange rates may well overshoot our long-term targets in the near term, as the need to cover short EUR positions is high", says the UBS analyst team.

"We recommend using the low option volatility to protect against further potential euro strength", they comment. "However, we keep our moderate long-term outlook as problems in France, Italy and Spain continue to weigh on the common currency".