FXstreet.com (San Francisco) - Westpac has noted in a research note that, one week into its USD three week holding period, its long USD surprise index basket trade is currently showing a -0.6% return.
“As we close the week a more charitable assessment of Draghi’s plans to use the ECB’s balance sheet has descended, weighing on our long USD basket,” says Westpac. “If this nascent trend of better than expected US data gathers momentum in coming weeks the odds of another round of Fed easing should moderate, US yields should rise and the USD may yet stabilise, all other things equal.”
“As we close the week a more charitable assessment of Draghi’s plans to use the ECB’s balance sheet has descended, weighing on our long USD basket,” says Westpac. “If this nascent trend of better than expected US data gathers momentum in coming weeks the odds of another round of Fed easing should moderate, US yields should rise and the USD may yet stabilise, all other things equal.”
