Risks remain tilted towards some extension of the USD rebound – Scotiabank
Source Fxstreet
The USD is steady in broad terms to start the week. Economists at Scotiabank analyze Dollar’s outlook.
Jobs data dust settles
Choppy USD trade Friday around the release of better-than-expected NFP but softer than forecast ISM Services data (especially employment) leaves a bit of a question mark over the near-term direction of FX, at least.
The slide in the USD reflected weaker US yields and perhaps positioning running into the jobs report where expectations had favoured stronger data. Downward revisions to the prior months’ data also took the edge off the USD’s initial reaction to the NFP report. Still, with the dust settling after the data, the USD won back some of the ground lost and still managed to close out the week in relatively positive shape.
From a broader point of view, risks – reflecting seasonal trends and technical price action – remain tilted towards some extension of the broader USD rebound that developed over the turn of the year.
Disclaimer: For information purposes only. Past performance is not indicative of future results.
Recommended Articles
US dollar clings to nine-week lows near 98.4 as Brent nears $100 and the yen hits a seven-month high — five events to watch todayThe dollar is pinned near nine-week lows even after a blockbuster jobs report, as an oil spike toward $100, a surging yen and China's reflation data crowd the driver's seat. Five key events to watch today: Brent at $99.46, USD/JPY at 154, China CPI/PPI, PBOC gold buying, and Thursday's PPI / Friday's CPI ahead of the September 15-16 FOMC.
The dollar is pinned near nine-week lows even after a blockbuster jobs report, as an oil spike toward $100, a surging yen and China's reflation data crowd the driver's seat. Five key events to watch today: Brent at $99.46, USD/JPY at 154, China CPI/PPI, PBOC gold buying, and Thursday's PPI / Friday's CPI ahead of the September 15-16 FOMC.
US August CPI lands tonight: after a 5.4% PPI shock, will the Fed hike on September 16?US August PPI came in at 5.4% year-on-year, above the 5.3% consensus, with core PPI at 4.6%. Traders have pushed the odds of a 25bp Fed hike on September 15-16 to around 70%. Tonight's CPI is the last major inflation print before the decision — here is the full calendar, the consensus numbers, and what a hot versus cool reading would mean for the dollar, yields, gold and stocks.
US August PPI came in at 5.4% year-on-year, above the 5.3% consensus, with core PPI at 4.6%. Traders have pushed the odds of a 25bp Fed hike on September 15-16 to around 70%. Tonight's CPI is the last major inflation print before the decision — here is the full calendar, the consensus numbers, and what a hot versus cool reading would mean for the dollar, yields, gold and stocks.
Brent tests $108 as a key export pipeline stays shut — can the rally clear $110?Brent crude rose 2.55% to $106.97 and WTI 2.32% to $102.30 as a major regional export pipeline remained offline with no restart timeline. Front-month backwardation has widened to $5.53 from $3.84 a week ago, European gas is at its highest since December 2022, and one analyst sees $119.48 if talks stall.
Brent crude rose 2.55% to $106.97 and WTI 2.32% to $102.30 as a major regional export pipeline remained offline with no restart timeline. Front-month backwardation has widened to $5.53 from $3.84 a week ago, European gas is at its highest since December 2022, and one analyst sees $119.48 if talks stall.
Fed hike odds near 90% into Wednesday's decision — how to trade the dollar, gold and the S&P 500A 0.3% monthly core CPI print has lifted the market-implied probability of a 25bp Fed hike on 16 September to roughly 86.5% ~ 90%, which would be the first increase since July 2023. Here is the decision timeline, the pricing versus the forecasts, both scenarios, and the key levels for the dollar, gold and the S&P 500.
A 0.3% monthly core CPI print has lifted the market-implied probability of a 25bp Fed hike on 16 September to roughly 86.5% ~ 90%, which would be the first increase since July 2023. Here is the decision timeline, the pricing versus the forecasts, both scenarios, and the key levels for the dollar, gold and the S&P 500.
Silver Price Forecast: XAG/USD falls to near $63.50 amid Fed hike bets, higher oil pricesSilver price (XAG/USD) loses its gains from the previous day, trading around $63.50 per troy ounce during Asian hours on Monday. Non-yielding Silver is currently facing significant headwinds driven by rising Federal Reserve (Fed) rate-hike expectations for the upcoming September decision.
Silver price (XAG/USD) loses its gains from the previous day, trading around $63.50 per troy ounce during Asian hours on Monday. Non-yielding Silver is currently facing significant headwinds driven by rising Federal Reserve (Fed) rate-hike expectations for the upcoming September decision.
Related Instrument
