Home USD: Structurally Bearish L-Term But Expecting A Reflation Squeeze Over Next 6 Weeks – TD
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USD: Structurally Bearish L-Term But Expecting A Reflation Squeeze Over Next 6 Weeks – TD

What is the forecast for the USD dollar into year-end?

Here is their view, courtesy of eFXdata:

TD Research  expects a USD short squeeze into year-end, expressing that via a short GBP/USD exposure as its ToTW for this week.

“Vaccine-related headlines remain a key source of optimism. The positive news of AstraZeneca and Oxford University’s results completed the trifecta recently. The result has helped nudge risk assets forward. Yet we caution on extrapolating the upbeat tone into yearend, where think the realities on the ground are grimmer,” TD notes.

We continue to forecast a deeper USD pullback in the quarters ahead. Still, it’s a choppy path. We expect a reflation squeeze over the next six weeks, reflecting the COVID winter, and associated mobility trends, positioning, valuation, and annual seasonal trends that benefit the USD,” TD adds.

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Kenny Fisher

Kenny Fisher

Kenny Fisher - Senior Writer A native of Toronto, Canada, Kenneth worked for seven years in the marketing and trading departments at Bendix, a foreign exchange company in Toronto. Kenneth is also a lawyer, and has extensive experience as an editor and writer.