News & Analysis at your fingertips.

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. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
EUR/USD
Mixed
Oil - US Crude
Bullish
Wall Street
Bullish
Gold
Bearish
GBP/USD
Mixed
USD/JPY
Mixed
More View more
Real Time News
  • Heads Up:🇬🇧 Public Sector Net Borrowing (MAY) due at 06:00 GMT (15min) Expected: £-26.1B Previous: £-31.7B https://www.dailyfx.com/economic-calendar#2021-06-22
  • The continuity seen across these volatility cycles is a good thing. Historical precedence offer a blueprint for identifying conditions supportive for a vol-event to occur, and how they may unfold. Deepen your knowledge of historical volatility here: https://t.co/vg7w10la3j https://t.co/er7rtWCEP0
  • (Tech Special) Canadian Dollar Outlook: USD/CAD Surge Hits Obstacles, Where to Next? #CAD $USDCAD #Loonie #technicalanalysis https://www.dailyfx.com/forex/technical/article/special_report/2021/06/22/Canadian-Dollar-Outlook-USDCAD-Surge-Hits-Obstacles-Where-to-Next.html?CHID=9&QPID=917702&utm_source=Twitter&utm_medium=Dubrovsky&utm_campaign=twr https://t.co/t4jCG9jNkO
  • Hang Seng Tech Index - Bullish MACD Convergence is forming - #HSTECH chart https://t.co/oy6GUjNqvG
  • 🇳🇱 Consumer Confidence (JUN) Actual: -3 Previous: -9 https://www.dailyfx.com/economic-calendar#2021-06-22
  • There are three major forex trading sessions which comprise the 24-hour market: the London session, the US session and the Asian session. Learn about the characteristics of each session here: https://t.co/reRmDe1Ksp https://t.co/ZBGVwxip3g
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Gold are long at 87.34%, while traders in France 40 are at opposite extremes with 74.19%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/aQ1Vgos6em
  • Forex Update: As of 04:00, these are your best and worst performers based on the London trading schedule: 🇪🇺EUR: -0.07% 🇯🇵JPY: -0.07% 🇨🇦CAD: -0.10% 🇨🇭CHF: -0.15% 🇳🇿NZD: -0.15% 🇦🇺AUD: -0.26% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/ifGQz24uiW
  • Heads Up:🇳🇱 Consumer Confidence (JUN) due at 04:30 GMT (15min) Previous: -9 https://www.dailyfx.com/economic-calendar#2021-06-22
  • Indices Update: As of 04:00, these are your best and worst performers based on the London trading schedule: France 40: 0.37% FTSE 100: 0.27% Germany 30: 0.26% Wall Street: 0.22% US 500: 0.18% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/FSBd3FRuSA
US Dollar Gains on Market Turmoil, Eyes Bond Sales and TIC Data

US Dollar Gains on Market Turmoil, Eyes Bond Sales and TIC Data

Ilya Spivak, Head Strategist, APAC
US Dollar Price Chart

FUNDAMENTAL FORECAST FOR THE US DOLLAR: BULLISH

  • US Dollar soars as emerging market turmoil stokes haven demand
  • Bond auction results and TIC data may cap yields, cooling the rally
  • Sentiment boost from US/Japan autos deal may not prove lasting

See the latest US Dollar forecast learn what will drive prices in the third quarter!

The US Dollar would not let a lull in local data flow slow upward progress last week, finding a catalyst in deteriorating risk appetite across financial markets. While the benchmark unit’s unrivaled liquidity was expected boost its haven appeal, the simmering US/China trade war was thought to be the likely culprit souring investors’ mood. As it happened, a meltdown in emerging market assets driven by turmoil in Turkey and Russia was the trigger, pushing the greenback to a 14-month high.

The week ahead offers an eclectic mix of would-be stimuli for continued volatility. Retail sales and consumer confidence data will inform Fed policy bets, but it would take an improbably dramatic deviation from forecasts to dislodge status quo expectations. The Economic Symposium in Jackson Hole, Wyoming later this month is likely to be the next real inflection point in the narrative. For now, markets have fully priced in another hike in September and peg the probability of a further increase in December at close to 60 percent.

Elsewhere on the docket, results from a series of bond auctions may generate attention. The markets have been concerned about the growth-negative implications of a spike in borrowing costs as the Treasury seeks to finance a yawning deficit amplified by a $1.5 trillion tax cut and $300 billion in increased spending championed by the Trump administration. The Dollar suffered as yields ticked down after demand was impressively stable at a record-setting 10-year note sale last week.

June’s TIC capital flow data will be similarly interesting. Net foreign purchases of US securities have risen alongside bond yields in the past two years, suggesting higher returns are attracting demand. That might bode well for uptake as the Treasury steps up debt issuance. Data showing more of the same might be supportive for the greenback considering the Fed’s hawkish lead in the G10 space. To the extent that this keeps a lid on borrowing costs however, it may yet be interpreted as limiting scope for appreciation.

Needless to say, turmoil around the broader markets remains an important consideration. US tensions with Iran, Turkey and Russia remain unresolved. Trade war concerns continue to escalate as Washington and Beijing hike tariffs on each other. An accord avoiding auto import tariffs on Japan seems likely. Such a result will probably offer a bit of a respite from risk aversion but the overall landscape seems too treacherous to conclude that this will be sufficient for a lasting ‘risk-on’ shift in sentiment.

FX TRADING RESOURCES

--- Written by Ilya Spivak, Sr. Currency Strategist for DailyFX.com

To contact Ilya, use the comments section below or @IlyaSpivak on Twitter

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

DISCLOSURES