USD gets softer after China announcing a consumption boost – ING

The US Dollar (USD) got a little softer against most currencies on Monday after Chinese policymakers said they would boost consumption ‘forcefully’, ING’s FX analyst Chris Turner notes.

DXY to face support at 105.40/60

“USD was a little softer against most currencies on Monday after Chinese policymakers said they would boost consumption ‘forcefully’. This will be music to the ears of President-elect Donald Trump who is seeking to reverse China’s $300bn trade surplus with the US.”

“The news particularly helped China-centric currency pairs such as the Australian dollar and the South African rand. Expectations of some more detailed Chinese policy measures on Wednesday and Thursday this week can probably prove slightly supportive for the Rest of World currencies.”

“For today, the US data calendar is light and the focus should be on some slightly better small business optimism embodied in the NFIB index. We doubt investors will want to chase the DXY too much lower ahead of tomorrow’s US CPI number and would expect support at 105.40/60 to hold on a closing basis.”