The USD slide can be considered over – Commerzbank

The dollar index (DXY) has been trading sideways since the start of the week. In the opinion of economists commerzbankthe USD slide is likely to have come to an end.

Levels around 1.04 are the new comfort level in EURUSD

“The USD slide can be considered to be over. Some people may not have realized it’s over and are only shorting the dollar because they think other market participants were still selling the greenback (never underestimate stupidity!), but it’s unlikely. “

“Levels around 1.04 are the new comfort level in EURUSD. It seems to me that the scenario of inflation that central banks cannot control seems to have been priced in as a result.”

“Further dollar weakness is possible down the road, once inflation starts to turn around globally and a more or less rapid return to inflation targets (or at least close to these levels) seems more likely.”

“In the meantime, it has become a generally accepted fact that both the Fed and the ECB are likely to slow down their key rate hikes. If this were to happen, it would take place on both sides of the Atlantic and thus almost synchronously. , so the slowdown should be more or less neutral for EURUSD.”