The USD can see more topside into next week's Fed, a hike priced in but a strong “full steam ahead” message given still easy financial conditions, near certain tax cuts and constructive inflation signals in the latest CPI/PCE can still entice USD buyers, according to Richard Franulovich, Research Analyst at Westpac.
“That backdrop likely sees a hawkish migration to the dots around an unchanged median (+75bp ‘18 & +50bp ‘19) and could see GDP revised up a smidge too (2.1% ‘18 & 2.0% ‘19).”
“Tax cuts still a point of caution. Senators Collins and Flake received assurances Congress will tackle Obamacare & immigration in exchange for their vote but conservative House GOP are strongly opposed. House Republicans from high tax states are renewing a push to stop repeal of state tax deductions too, a major revenue item the Senate will not yield to. Beyond that, struggling to see fresh USD positives: tax cuts are priced in and yield/data support has firmed yet the DXY is stuck at the bottom of a 3yr range.”
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 in these securities. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Forex 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 total loss of principal, are your responsibility.