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Despite a reversal today, the US dollar looks set to appreciate for the sixth week running as “risky” assets remain under pressure. The DXY index has had its largest six-week gain since mid-2016 (while the S&P 500 has had its worst such period since the …
13th May 2022
The US dollar looks set to eke out small gains against most currencies this week as US bond yields rose further and equities whipsawed. While the net effect of the FOMC’s policy announcement and today’s US payrolls report on currency markets was …
6th May 2022
The US dollar rose for a third week in a row, reaching its strongest level since early 2017 as the growing policy divergence between the major Asian central banks and the rest of the world as well as concerns about Europe’s energy supply added fuel to …
29th April 2022
Another week of broad-based appreciation has seen the US dollar edge higher even as US bond yields have stalled. Instead, it is the sell-off in equity markets over the past couple of days which has driven the greenback to a new high. In some sense, the …
22nd April 2022
The US dollar continued to edge higher against most major currencies, with the DXY index (and 10-year US Treasury yields) reaching a new high for the year. The renewed rise in Treasury yields today reversed the dollar’s weakness following a …
14th April 2022
The US dollar has risen across the board this week as the Fed’s hawkish message on “quantitative tightening”, renewed sanction risks in Europe, and the polling shift in favour of far-right candidate Marine Le Pen ahead of France’s presidential election …
8th April 2022
Another solid gain in US payrolls did little to boost the dollar today, which seems set to end the week little changed against most major currencies. During the course of this week, central banks in Chile, Czechia, and Colombia continued to tighten …
1st April 2022
Amid the broad-based “risk-on” tone in markets this week, the US dollar has edged down against most major currencies. As was the case last week, an increasingly hawkish tone by the Fed and a rise in 10-year US Treasury yields had little impact on the …
25th March 2022
Even after its broad-based appreciation today, the US dollar seems set to end the week a bit lower against most major currencies. This is somewhat surprising given the FOMC’s hawkish tone on Wednesday and Fed Governor Waller’s comment today that a 50bp …
18th March 2022
The war in Ukraine continues to dominate both the news headlines and financial markets. While market conditions have remained very volatile, this week has seen a degree of stabilisation of risk sentiment in the absence of major new escalations. As a …
11th March 2022
The war in Ukraine has generated two clear effects in FX markets: the European currencies most immediately exposed to the war and its economic fallout have fallen against the US dollar, while most commodity currencies have strengthened as commodity prices …
4th March 2022
The Russian invasion of Ukraine early on Thursday morning has, aside from the ruble, so far made only limited impact on currency markets. The US dollar and other safe havens rose sharply on news of the invasion, accelerating the shifts over the previous …
25th February 2022
Although it has rebounded today, the US dollar lost a little ground against most major currencies over the week as a whole, as the FOMC minutes prompted a scaling back of market expectations for Fed tightening and risk sentiment see-sawed on continued …
18th February 2022
The US dollar seems set to end the week broadly unchanged against most major currencies despite a favourable shift in government bond yield differentials. While we suspect there is limited scope for a further rise in short-term US Treasury yields, our …
11th February 2022
A week after the FOMC’s hawkish message sent the US dollar soaring, the ECB delivered an even bigger surprise at yesterday’s policy meeting by opening the door to policy rate hikes later this year. That resulted in the euro’s largest single-day gain …
4th February 2022
The trade-weighted US dollar reached its highest level since July 2020 this week after short-term rate differentials moved strongly in its favour following Wednesday’s hawkish FOMC meeting . Admittedly, with so many Fed rate hikes discounted this year, we …
28th January 2022
The trade-weighted US dollar seems set to end the week a bit higher, reversing some of its recent decline. But the dollar strength has mostly been against G10 currencies; despite the fall in US equities this week, the “riskier” emerging market (EM) …
21st January 2022
Despite several events in the US this week which would usually point to a stronger dollar – the highest US inflation print since the early 1980s , hawkish comments from both Chair Powell and Vice Chair Brainard, and a sharp rise in short-dated government …
14th January 2022
Today’s US non-farm payrolls report had little impact on currency markets, with the dollar set to end the week broadly unchanged against most other currencies. This extends a pattern of low volatility in FX markets over the past few weeks, leaving the DXY …
7th January 2022
This week’s much-anticipated round of central bank policy announcements made only limited impact on currency markets, which for the most part are broadly unchanged on the week. Indeed, despite the significant hawkish shift in the FOMC’s message on …
17th December 2021
Today’s US CPI data produced a relatively limited reaction in the US dollar, which is set to end the week a bit weaker against most major currencies. Attention now turns to the 17(!) central bank meetings next week, including the Fed, ECB, BoE, and BoJ. …
10th December 2021
After rallying to its highest level of the year last week, the US dollar seems set to end this week broadly unchanged. In our view, this reflects the offsetting effects of rising short-term yields in the US (particularly after Chair Powell’s comments to …
3rd December 2021
News late yesterday of a new and potentially more dangerous variant of COVID-19 emerging in South Africa has made a dramatic impact on financial markets today. In general, market shifts have been similar to those in previous periods of renewed uncertainty …
26th November 2021
The US dollar is set to end another week higher against nearly all major currencies. To a large extent, this latest rally appears to be driven by the rise in short-term government bond yields in the US relative to other major economies, notably the …
19th November 2021
The US dollar has continued to grind higher against major currencies following the release of US inflation data on Wednesday, with the DXY index reaching its strongest level in over a year. Recent data, in particular the strong inflation figure this week …
12th November 2021
After another week of wild swings in short-term interest rate markets, the US dollar is ending the week stronger against most major currencies. On a trade-weighted basis it is now near its strongest level since last November. Neither the Fed meeting nor …
5th November 2021
Currency markets remained remarkably stable for most of this week, although the US dollar is rallying sharply today on the back of data showing very strong wage growth in the US, even as a major reassessment of the pace of monetary policy normalisation in …
29th October 2021
With a couple of exceptions, currency markets have had a quiet week; the US dollar is ending the week a touch weaker against most other currencies, but in aggregate it remains close to its strongest level for the year. With US bond yields continuing to …
22nd October 2021
The US dollar seems set to end the week lower against most currencies, as “risky” assets have rallied and US Treasury yields have edged down a bit. This fall back in the dollar and US yields is somewhat surprising in light of the stronger-than-expected …
15th October 2021
Despite the rise in US Treasury yields this week, the US dollar reversed some of its recent gains after today’s labour market data were somewhat weaker than expected . But given strong wage growth, we doubt this will alter the Fed’s policy path. Indeed, …
8th October 2021
In another volatile week, the US dollar continued to appreciate against most other currencies, reaching its strongest level, in aggregate, since last November. In part, the greenback’s rally may have been driven by month- and quarter-end flows, and it has …
1st October 2021
In a choppy week dominated by some surprising central bank announcements and the ongoing uncertainty around China’s property sector, the US dollar continued to make some headway, especially against emerging market currencies. The FOMC delivered another …
24th September 2021
The dollar has risen against most currencies as markets have remained quiet ahead of next week’s monetary policy announcements. In addition to the FOMC, more than a dozen central banks in developed and emerging market economies will meet during a week …
17th September 2021
After weakening over the preceding two weeks, the US dollar has rebounded against most other currencies this week. Nonetheless, last week’s disappointing payrolls report and the slightly less upbeat tone in recent comments from FOMC members appear to have …
10th September 2021
The US dollar was little changed following the surprisingly weak August payrolls data, despite a small rise in US government bond yields. It looks set to end another week lower against most currencies, leaving the trade-weighted dollar near its lowest …
3rd September 2021
The US dollar gave back much of its gains from last week, as appetite for risk recovered and Chair Powell’s much-anticipated speech today provided some relatively dovish guidance on the path for Fed interest rate hikes. Nonetheless, we think that this …
27th August 2021
The US dollar has risen sharply this week, reaching its highest level of the year as continued fears about the spread of the “delta” variant and further evidence of growing risks in China (around its economic slowdown, the widening regulatory crackdown on …
20th August 2021
The US dollar looks set to end the week little changed against most currencies, as US inflation data – this week’s main data release – failed to push up the currency further. Next week, the minutes of the Fed’s July meeting may shed more light on …
13th August 2021
The US dollar is ending the week higher against most currencies, extending its gains alongside rising US Treasury yields following the stronger-than-expected July payrolls data . With Fed officials earlier this week suggesting that several more months of …
6th August 2021
Following a strong run over the past month, the US dollar has weakened across the board this week after some softer-than-expected US data and a non-committal FOMC. Next week’s key data releases include the ISM manufacturing survey and the all-important …
30th July 2021
While the US dollar has fallen back a little against most currencies in the second half of the week as the sharp sell-off in risky assets and currencies on Monday was reversed, it looks set to end the week slightly stronger, continuing its strong run …
23rd July 2021
While the US dollar rose sharply after Tuesday’s exceptionally strong inflation print, that was partly offset by Fed Chair Powell’s relatively dovish comments in his testimony to Congress. But overall, the greenback continues to trade on the front foot as …
16th July 2021
Although it has fallen back a bit today after China delivered a surprise cut to banks’ reserve requirements, the US dollar has otherwise continued to appreciate against most currencies. The dollar’s strength appears increasingly driven by concerns about …
9th July 2021
The US dollar is ending the week stronger against most currencies, although it has fallen back a little this afternoon despite the stronger-than-expected non-farm payrolls report . While that reaction is perhaps a bit puzzling, the bigger picture is that …
2nd July 2021
The US dollar seems set to end the week slightly weaker, but has held much of its gains following last Wednesday’s FOMC announcement. With increasing focus on the prospects for monetary tightening globally, next week’s employment and survey data in the US …
25th June 2021
The FOMC’s optimistic assessment of the outlook and the significant shift up in its “dot plot” projections has sent the US dollar soaring over the past couple of days. We have brought forward our own forecast for the first Fed hike (see here), and our …
18th June 2021
Although Treasury yields somewhat surprisingly fell after the larger-than-expected rise in inflation last month in the US, the dollar is ending the week slightly stronger against most currencies. Attention next week will focus on the FOMC meeting, and …
11th June 2021
In another see-saw week for FX markets, the US dollar again looks to be ending it broadly flat after the key non-farm payroll figure proved somewhat weaker than consensus expectations. Next week’s US inflation print looks set to continue the data …
4th June 2021
While strong data in the US have provided some support for the dollar, it remains broadly flat on the week. With economic recoveries well underway in most developed markets, focus remains on what the latest data can tell us about the relative prospects …
28th May 2021
In a fairly quiet week for currency markets, the minutes from the FOMC’s April meeting proved the highlight. The US dollar rose sharply on the news that at least some Fed officials are keen to start ‘talking about talking about tapering.’ While that rally …
21st May 2021