US October CPI data sparked the biggest sell-off in the Dollar since – coincidentally – the same October CPI report in November 2022. Economists at the MUFG Bank analyze the outlook for the USD.
Large sell-offs in the dollar signal the possibility of more to come
We suspect that the scale of the Dollar sell-off on Tuesday could also prove significant and mark another turning point that sees the USD extend this weakness further.
It is now more likely that the Fed has ended its tightening cycle. A rate cut by May 2024 is now an 80% probability, priced at 85 basis points by November 2024. There remains plenty of room for further cuts to be priced if activity data begins to weaken and, In those circumstances, EUR/USD is very likely to advance towards 1.1500 in 2024.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
