Has the US Dollar Uptrend Finally Resumed?
- Long-term US Dollar uptrend may be resuming on shifting Fed bets
- "Brexit" worries likely to become more acute as referendum nears
- Bank of Canada rate decision headlines otherwise muted calendar
A monetary policy announcement from the Bank of Canada amounts to the only bit of high-profile stand-alone event risk on the economic calendar this week. While no changes are expected, traders will be keen to parse comments from Governor Stephen Poloz and company on where they intend to steer in the months ahead.
Meanwhile, big-picture themes will have room to develop. First, traders will have an opportunity to continue re-pricing Federal Reserve rate hike expectations after last week's saber-rattling from central bank officials. Futures suggest the markets now see a better-than-even chance of a hike in July. A busy week of commentary from key Fed policymakers will help to inform the narrative.
Second, the much-anticipated referendum to decide the status of UK membership in the European Union is drawing closer and polls appear to be starting to skew somewhat, with a 47 to 40 percent majority now seemingly favoring the status quo. Traders are likely to be paying ever-more attention, with swings in public opinion likely to echo across financial markets.
--- Created by Ilya Spivak, Currency Strategist for DailyFX.com
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