Jens Sorensen, Chief Analyst at Danske Bank, gives his views on the recent price action around the buck.
Key Quotes
“USD was on a general retreat yesterday in what seems mainly a relief story in the absence of new trade woes. Near term, there is little in the calendar before US CPI on Thursday, which should merely confirm that inflationary pressure remains and keep the Fed on course to hike twice more this year – and with a December hike only priced in with a 60% probability, there is still possibly some USD strength left with carry appeal of dollars being added to continually”.
“That said, USD positioning is stretched long, which hinders significant EUR/USD downside below 1.15″.
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