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
Oil - US Crude
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
More View more
Real Time News
  • Indices Update: As of 20:00, these are your best and worst performers based on the London trading schedule: Wall Street: -0.01% US 500: -0.02% Germany 30: -0.15% France 40: -0.27% FTSE 100: -0.29% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/cM1AaFUMth
  • Gold prices are finally showing life in what should be one of the best fundamental environments in recent history.Get your $XAUUSD market update from @CVecchioFX here:https://t.co/HnvUE9TvP8 https://t.co/GuLYbE19VH
  • ECB VP de Guindos: - ECB forecasts inflation to decline next year and remain low - There is still time to decide on the PEPP program's destiny $EUR
  • Commodities Update: As of 18:00, these are your best and worst performers based on the London trading schedule: Silver: 2.74% Gold: 1.27% Oil - US Crude: -0.04% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/h3JUhrkoia
  • USD/CAD continues to reverse lower, now trading below the June swing high $USDCAD https://t.co/dl3shF0neT
  • Company earnings bolster FTSE 100 index. Downtrend on UK treasury yields continues. Get your market update from @WVenketas here:https://t.co/b7ALnOgbaO https://t.co/MVR4c4VVTZ
  • https://t.co/Ldf98qDw0P
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Silver are long at 92.15%, while traders in Wall Street are at opposite extremes with 75.10%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/CeIupH0opI
  • Indices Update: As of 18:00, these are your best and worst performers based on the London trading schedule: US 500: 0.61% Wall Street: 0.61% FTSE 100: -0.04% Germany 30: -0.04% France 40: -0.09% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/iblONqMY4m
  • EUR/USD continues to push higher on post-FOMC USD weakness, eyeing test of 1.19 $EURUSD https://t.co/yzkh0Cjlj3
US Dollar Fundamental Forecast: More Upside on Fed Bets, Safe-Haven Flows

US Dollar Fundamental Forecast: More Upside on Fed Bets, Safe-Haven Flows

Thomas Westwater, Analyst

US Dollar Fundamental Forecast: Bullish

  • US Dollar benefiting from strong fundamental backdrop
  • Accelerated bets on taper talks helping fuel USD Strength
  • Safe-haven flows aiding Greenback as Asia battle Covid

The US Dollar finds itself in a solid fundamental position that may lead to further gains as Federal Reserve taper talk bets increase. Traders began to ramp up bets on accelerated monetary policy tightening following June’s FOMC meeting, which showed an upward revision in the Fed’s Dot Plot. Nevertheless, Fed Chair Jerome Powell has pushed back on the notion that the central bank will begin tapering soon. The dovish pushback saw investors move back into US Treasuries.

Even so, markets appear more convinced than not that a reduction of the balance sheet is now on the horizon. What remains in question, however, is when the Fed will send a tangible signal on tapering its balance sheet. If Mr. Powell’s recent language is to be taken at face value, we may still have a ways to go. Still, Friday’s upbeat US retail sales figure shows the US economic recovery remains on solid footing.

Meanwhile, the USD is also benefiting from safe-haven flows. A resurgence in Covid, driven by the highly transmissible Delta variant, through Asia is seen as a growing threat to global growth. South Korea, Australia, and Japan have seen lockdowns or other forms of social-distancing measures reintroduced. This could be driving foreign demand in the Treasury market, which would also be a tailwind for the Greenback as offshore buyers convert into Dollars to buy the US debt.

All things considered, the US Dollar is likely to continue running higher if the US economy continues to perform well, particularly while Asia battles another wave of the virus. The current global environment bodes well for the US Dollar’s continued run. Ultimately, however, the trade may become saturated and susceptible to an unwind, but for now, the rosy view remains.

US Dollar TRADING RESOURCES

--- Written by Thomas Westwater, Analyst for DailyFX.com

To contact Thomas, use the comments section below or @FxWestwateron Twitter

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

DISCLOSURES