FXStreet (Delhi) – Analysts at BBH, notes that the Greenback has surged against most of the major currencies in the past week with the exception of Japanese Yen. Dollar bulls have managed to reassert themselves and Fed’s upcoming policy meet will act as the next major trigger before any substantial move.
Key Quotes
“The US dollar gained against most of the major currencies last week. A notable exception was the Japanese yen. Steep equity losses and drop in bond yields provided the yen with the customary fillip.”
“The various economic reports, including the August jobs data and the volatility of the stock market, left Fed expectations unchanged. The September Fed funds futures contract closed at 99.83 (implying a 17 bp effective average Fed funds rate this month).”
“It is clear that the prospects of a rate hike by the Fed later this month have become somewhat murkier due to the volatility of financial markets and potential global headwinds. However, the divergence theme, which in our assessment is the main driver of this, the third dollar bull market since the end of Bretton Woods, was not tied to the precise timing of the Fed’s lift-off.”
(Market News Provided by FXstreet)