The US dollar trading soft in the wake of CPI and BOJ intervention – BBH
|The Dollar index (DXY) is trading lower for the third straight day near 104.32 as markets digest the double whammy of good inflation data and surprise BOJ intervention, BBH FX strategists note.
DXY trades lower near 104.32
“DXY is trading lower for the third straight day near 104.32 after good US inflation data and surprise Bank of Japan (BOJ) intervention. The BOJ did not get much bang for the buck as USD/JPY has already recouped nearly half of yesterday’s losses and trading back above 159. The Euro (EUR) is trading higher near $1.0890 against the US Dollar, while the Pound Sterling (GBP) is trading higher near $1.2960.”
“Recent softness in the U.S. data is challenging our view that the backdrop of persistent inflation and robust growth in the U.S. remains largely in place. Indeed, more Fed officials are voicing concern about labor market weakness.”
“However, we continue to believe that weaker data in many of the major economies will feed into more dovish central banks, underscoring that the relative story should continue to support the dollar.”
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