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Ray Attrill, Head of FX strategy at National Australia Bank (NAB), said in his latest client note that the US dollar could benefit from both risk-on and risk-off market conditions.

Key Quotes:

“The dollar seems to be benefiting from risk-on conditions where its yield attractions in an ultra-low FX volatility environment still stand out and its equity market continues to perform better than elsewhere.

The dollar is also able to benefit from risk-off conditions via traditional safe haven support for US Treasuries.

The diverging economic data performance recently between the euro and dollar as a key reason as well by noting that this has aggravated euro weakness while supporting the greenback at the same time.”