We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Bearish
USD/JPY
Bullish
Gold
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Bitcoin
Mixed
More View more
Real Time News
  • Have you been catching on your @DailyFX #podcast "Global Markets Decoded"? Catch up on them now, before new episodes release! https://t.co/mk1w1DM2Rh https://t.co/rEVhCnC0vY
  • Asia’s vast and growing importance to the world economy is not yet matched by the presence of a currency trading center to rival the established order. Get your update on market drivers in Asia here: https://t.co/r3Ku0p9dw1 https://t.co/I1AA0UEyWq
  • Geopolitical developments send #oil prices soaring or falling. Get your market update from @MartinSEssex here:https://t.co/XVXLyG8vjq #OOTT https://t.co/o4zt4pmSzc
  • The $USDINR may fall as the Nifty 50 rises after the US and China avoided tariff escalation and Indian CPI increased at its fastest pace since July 2016 amid on onion shortage. Get your market update from @ddubrovskyFX here:https://t.co/iXLf98geXL https://t.co/uVwbkkkl09
  • My weekend trading video: 'A #Dow and Yuan Retreat Could Break 2019's Bullish Complacency' https://www.dailyfx.com/forex/video/daily_news_report/2019/12/14/A-Dow-and-Yuan-Retreat-Could-Break-Break-2019s-Bullish-Complacency.html?CHID=9&QPID=917719
  • The $USD may extend declines against its ASEAN counterparts after the Fed rate decision. The Philippine Peso and Singapore Dollar are attempting key technical breakouts. Get your market update from @ddubrovskyFX here:https://t.co/JoPLb4Oi2q https://t.co/fKzeBlWaCx
  • Negative yielding government bonds – What are they telling us? Find out from @nickcawley1 here: https://t.co/F6JuhmrvPT https://t.co/Mf9e1cgWmR
  • The #Euro jumped higher to challenge range resistance capping upside progress since mid-October. Signs of ebbing momentum warn it may be back on defense soon. Get your market update from @IlyaSpivak here: https://t.co/MGqVDEWhUD https://t.co/rQRxJAmLWi
  • RT @zerohedge: Is The Market Up This Week? Just Ask The Fed's Balance Sheet https://t.co/6p01J9yAZ8
  • $USD: "The US Dollar is making a last-ditch effort to cling onto a key technical support level after dropping 3% from its 2019 high as risk appetite roars and the Fed inflates its balance sheet." - via @DailyFX Full Analysis: https://www.dailyfx.com/forex/fundamental/us_dollar_index/usd_trading_today/2019/12/14/us-dollar-outlook-fx-volatility-rising-from-extreme-lows-usd-levels-to-watch.html https://t.co/87cITJPVQa
US Dollar: Rates-Driven Trend Complicated by Geopolitical Jitters

US Dollar: Rates-Driven Trend Complicated by Geopolitical Jitters

2017-04-08 04:00:00
Ilya Spivak, Sr. Currency Strategist
Share:
US Dollar: Rates-Driven Trend Complicated by Geopolitical Jitters

Fundamental Forecast for the US Dollar: Neutral

  • Cordial Trump/Xi meeting, payrolls data boosts Fed outlook
  • Yellen speech, CPI figures may help US Dollar extend advance
  • Geopolitics clouds risk appetite trends after US strike on Syria

Where is the US Dollar heading in the second quarter? See our forecast to find out!

The US Dollar rose for a second week as Fed rate hike expectations continued to recover. An encouraging jobs report and US President Donald Trump’s seemingly cordial meeting with his Chinese counterpart Xi Jinping stood out as catalysts.

March employment figures fell short of expectations on the headline payrolls reading but the jobless rate declined even as labor force participation held steady and wage inflation held near eight-year highs. That suggests the smallish payrolls gain speaks to nearing “full employment” rather than something ominous.

As for the Trump/Xi sit-down, the US head of state called their budding relationship “outstanding” and senior cabinet officials echoed similar sentiments after meetings with their Chinese counterparts. That appeared to ease worries about a globally destabilizing rift, removing a potential barrier to Fed tightening (for now).

Next week, a speech from Fed Chair Janet Yellen is likely to reiterate an intent to press on with stimulus withdrawal and CPI data is expected to show a pickup in core inflation. That may keep the greenback marching higher as traders weigh the US policy path against standstill elsewhere in the G10.

Geopolitical jitters may yet overshadow macro fundamentals however. The full ramifications of last week’s surprise US missile strike on Syria will take time to emerge. Escalating tensions may undermine market-wide risk appetite. Since the Fed is not keen to hike rates gains such a backdrop, this may hurt the US unit.

Performance may be disparate in a risk-off scenario given the benchmark currency’s haven asset status however. It may track lower against the Japanese Yen but stands to gain versus sentiment-geared alternatives like the Australian and New Zealand Dollars if the markets’ mood sours.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.