DXY, USD/CAD, USD/ZAR Analysis
- Dollar dip unlikely to persist – USD fundamentals remain strong
- USD/CAD drops after hot Canadian inflation print
- Impressive ZAR unwinds despite a weaker dollar
Dollar Dip Unlikely to Persist – USD Fundamentals Remain Strong
The US dollar basket (DXY) – a benchmark for dollar performance against select major currencies – trades lower this morning, continuing yesterday’s decline. The pullback appears more than a week after the index put in 9 consecutive green trading days, bringing DXY from 97.70 to 100.
The DXY’s decline is largely attributed to the recent rise in EUR/USD – which makes up 57.6% of the index – as the end to accommodative monetary policy is likely to occur at the end of Q2 with a first rate hike anticipated in early Q3. What does this mean for the dollar?
The dollar still boasts very strong fundamentals, with an aggressive rate hike timeline as we could see multiple 50 basis point…
