USD losses widen. Shaun Osborne, Scotiabank’s chief currency strategist, discusses the outlook for the dollar.
The dollar will be more susceptible to weak economic data reports in the future
Economic data this week has trimmed the odds of the Fed making two more hikes this year and history shows markets are quick to price in the prospect of a Fed rate cut once the peak of the cycle is reached. of rates; History also shows that this tends to put pressure on the USD, and that is more or less felt where we are in this process, with the USD trading at its lowest level since last April. The dollar is likely to be more susceptible to weak economic data releases in the future.
The DXY has fallen almost 2% on the week and is trading below the lows of January and April, at 100.8 points. This implies (to me) that the risks are leaning towards another 2-3% drop at least in the coming weeks and months (which could go as low as around 5% loss, based on the charts).
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.
