US Dollar Index: Corrective pressure points lower – Scotiabank
Scotiabank strategists Shaun Osborne and Eric Theoret note the US Dollar (USD) is easing for a third straight session as Fed hike expectations fade, with swaps now pricing less than 20bps of tightening by September. They highlight a bearish pause in the US Dollar Index' (DXY) May–June rally and suggest corrective pressure could push the index back toward the 100.50/60 area.
Dollar rally losing upside momentum
"The dollar is down for a third day in a row—at writing, at least—as the May/June rally in the DXY shows signs of running out of steam."
"Just as markets and forecasters appear to be taking on the idea of a hawkish Fed and a stronger dollar more fully, Fed rate hike risks are fading slightly, with swaps pricing in less than 20bps of Fed tightening by September now."
"DXY price action late last week signaled a bearish pause in the recent rally."
"Corrective pressure on the DXY may drive the index back to 100.50/60."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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