As market expectations regarding US key rates have moved upwards, Commerzbank's economists examine the outlook for the USD and discuss what could have been.
The market and the FOMC are generally in agreement on the projections of the future path of interest rates for the first time in recent memory. There was no movement by the FOMC, but rather by the market. The market shifted its expectations on interest rates to the upside, not the FOMC. There are all things that are in favor of the US dollar.
I believe that if we agreed with the new view on the Fed, the current strength of the Dollar would be considered to be sustainable. However, we don't have that information. The Fed watchers continue to predict that there will be no further hikes in interest rates. Because of this, we are expecting that there will not be a sustainable strength in the USD in the foreseeable future.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell these assets. You should do your own thorough research before making any investment decisions. EnclaveFX Ltd does not in any way guarantee that this information is free of mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in the Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses, and costs associated with investing, including the total loss of principal, are your responsibility.
EnclaveFX Ltd and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. EnclaveFX Ltd and the author will not be liable for any errors, omissions, or any losses, injuries, or damages arising from this information and its display or use. The company is not responsible for errors or omissions.
