OREANDA-NEWS. March 11, 2015. Deutsche Bank said on Tuesday it expects the euro to fall to parity with the dollar as early as the end of this year, and it forecast the single currency would drop to just 85 cents per euro for 2017.

Germany's biggest bank, the world's second-largest currency trader, had led the way last year in forecasting a devaluation of the euro, saying it expected a huge outflow of investment from Europe in the next two years.

But Deutsche analyst George Saravelos said the age of "Euroglut" has progressed faster than he expected. In a Euroglut, Europe's savings and the money brought in by Germany's large trade surplus pile up and get exchanged for higher-yielding currencies.

"European outflows have been even bigger than our initial expectations over the last six months," he wrote. "We now foresee a move down (for the euro) to \\$1.00 by the end of the year and a new cycle low of 85 cents by 2017."

Deutsche's previous forecast was for the euro to reach parity by the end of next year and 95 cents in 2017.

Reuters polling as recently as last week showed most banks expected the euro to fall to around \\$1.08 over the next 12 months. But a new bout of dollar buying since last Thursday has since taken it as low as \\$1.06995.