The US Dollar declined further yesterday. Is the USD now weakening sustainably? Economists at Commerzbank think it is still too early for that.
Waiting for US inflation data
“The Fed has once again made it clear that it will actively fight high inflation. However, it is certainly also hard to imagine that the Fed will become even more hawkish and thus provide further new positive impetus for the USD. In this respect, probably no wonder that the USD has corrected a bit in recent days.”
“The currency market should be eagerly awaiting the inflation data from the US. Should these surprise to the upside, the USD could again receive a new tailwind because then it is likely to be speculated that the Fed could perhaps increase again by 75 bps in December. However, the figures will be published only on Thursday.”
“After the correction of the last few days, I could imagine that the currency market in the run-up to the inflation data will rather stay put.”