The Fed’s hawkish pause has led to a 15 basis point rise in the US yield curve and a strengthening of the Dollar. ING economists analyze the outlook for the dollar.
The DXY Dollar Index will rise to 106
This hawkish stance could keep the dollar bullish in October, and will require weaker US activity data – in particular, an increase in jobless claims or a decline in the consumer confidence and retail sales – so that the Dollar softens. The Fed will not give any joy to the Dollar bears.
With US yields firm and US rate volatility sinking again, USD/JPY will be at the forefront of this period of Dollar strength. More verbal interventions are expected from Tokyo and we suspect that the trigger will be pulled as it approaches the 150 level.
We expect the DXY Dollar Index to rise to 106.
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.
