USD: Room For Further N-Term Weakness Against High-Yielding Currencies – Barclays

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The US dollar received a blow from the Federal Reserve and its dovish hike. Is there more to come?

Here is their view, courtesy of eFXnews:

Barclays Capital FX Strategy now sees room for further near-term USD consolidation in light of last week’s ‘unhurried’ Fed which boosted risk assets and weakened the USD as the central bank seemed in no hurry to project a higher path of rate hikes next year.

In particular, Barclays expects further near-term USD weakness, concentrated primarily against high-yielding currencies.

“History suggests that this point in the Fed’s tightening cycle is typically followed by further near-term USD weakness, stable equity prices and lower 10y UST yields,” Barclays notes.

Barclays also continues to forecast two more rate hikes this year and three hikes in 2018 and expect to hear more from the committee about its balance sheet policies at the June FOMC.

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Yohay Elam – Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I’ve accumulated. After taking a short course about forex. Like many forex traders, I’ve earned the significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I’ve worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.

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