USD: Best performing currency in the month to date - Rabobank
|Jane Foley, Senior FX Strategist at Rabobank, notes that the USD is the best performing G10 currency in the month to date and the gains are largely attributable to a rise in expectations regarding a Federal Reserve rate hike in December.
Key Quotes
“Market positioning suggests that the better tone in the greenback may have a little further to run. However, in order for the USD to continue its broad based gains, the market would likely have to adjust higher its expectations regarding the build-up of price pressures in the US and reassess the pace at which the Federal Reserve is likely to hike interest rates.
In our view the outlook for inflation in the US remains subdued and that after a hike at the end of this year the Fed will only raise interest rates once at most during 2017. As a consequence we expect the present uptrend in the dollar to run out of steam by year end.”
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