TD Securities economists discuss how it could affect the dollar and the USD/JPY and EUR/USD pairs the publication of the Consumer Price Index (CPI) tomorrow.
The bar is high to force a reversal
“The market has again targeted a decrease in the aggressiveness of the Fed and puts the USD on the defensive. A figure above consensus does not strike us as a particular threat to the dollar. On the other hand, it is also not clear that a positive surprise in core inflation would tremendously alter the trajectory of the USD.”
“As much as the USD seems stretched on a tactical basis, we believe the bar is high to force a reversal. USD rallies should sell“.
“With the BoJ meeting next week, USD/JPY is a clear candidate for further declines. In the meantime, EUR/USD has shown its resilience; 1.0780/00 is all that stands in the way of another crash.”
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.
