USD: Data obstacles this week – ING

The US dollar (USD) found some support last week after a very weak March. The repeated caution of the Federal Reserve on rates cuts has probably prevented that an additional bearish feeling is accumulated over the dollar. Reports that suggest that some countries may be exempt from the first wave of protectionism are helping the feeling of risk and are weighing modestly over the dollar this morning, says the FX analyst of ING, Francesco Pesole.

The DXY can potentially be reset around 104

“At the same time, there are key data obstacles on the road to the re-estate of the dollar. As things are now, consumer’s confidence is probably the only most important input for the FX, so the results of the survey of the Tomorrow’s Conference Board are the key event of the week. Our forecast is 93, near the consensus, but the activity indicators have substantially been substantially below the expectations late Publication as a mostly downward risk for the USD.

“Peace (indirect) conversations between Russia and Ukraine will also continue in the radar of investors. The latest developments suggest some improvement, but do not provide a clear indication that a high immediate fire is on its way. The optimism of the market in this regard, which was shown through a low performance of some European currencies, runs the risk of being climbed a little more unless there is a tangible progress in the conversations of tangible in the conversations of this week.”

“We maintain a bullish bias over the dollar for the next few weeks. But the short -term noise remains probable, and the dollar can weaken in the first half of this week due to some weak PMIS (today) and disappointments in consumer confidence (tomorrow) before recovering towards the publication of the PCE on Friday, with the DXY potentially remarking around 104.”