The US dollar found its footing, stabilizing after long weeks of losses. What’s next? The team at CIBC already looks into the end of the year.
Here is their view, courtesy of eFXnews:
CIBC FX Strategy Research notes that policymakers in the US have appeared reasonably comfortable that inflation will start to heat up again.
“…And even though it hasn’t shown much sign of doing so yet, the latest minutes revealed that the inflation debate only heated up a touch with only a handful more mentions compared with May. Most importantly, “many” still viewed the recent weakness as transitory.
While it’s true that we’ve had one more soft CPI print since the Fed met, the comfort of many officials still keeps the possibility of a December rate hike very much alive – something that markets aren’t currently priced for,” CIBC adds.
“As such, we could see a pause in US$ weakness over the second half of this year,” CIBC concludes.
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