1 Jul 2015
USD stance remains constructive – BAML
FXStreet (Edinburgh) - The perspective for the US dollar remains positive in the medium to longer terms, according to analysts at BAML.
Key Quotes
“The dollar struggled once again in June despite signs that US data was turning a corner amidst a continued rise in German sovereign yields and unwind of USD longs”.
“However, we continue to see solid US fundamentals as driving USD strength as the year progresses”.
“In particular, non-farm payrolls growth remains at a healthy 236,000 pace (6m avg), wage expectations are accelerating, and retail sales rebounded”.
“Chair Yellen communicated she would like to see more ‘decisive evidence’ of growth before raising rates in the June meeting, a slightly higher bar than before, but September remains our base case”.
“With the market pricing a roughly 45% chance, and only 1 hike in 2015 (versus our call for 2), the USD will be supported as market expectations shift toward our view”.
Key Quotes
“The dollar struggled once again in June despite signs that US data was turning a corner amidst a continued rise in German sovereign yields and unwind of USD longs”.
“However, we continue to see solid US fundamentals as driving USD strength as the year progresses”.
“In particular, non-farm payrolls growth remains at a healthy 236,000 pace (6m avg), wage expectations are accelerating, and retail sales rebounded”.
“Chair Yellen communicated she would like to see more ‘decisive evidence’ of growth before raising rates in the June meeting, a slightly higher bar than before, but September remains our base case”.
“With the market pricing a roughly 45% chance, and only 1 hike in 2015 (versus our call for 2), the USD will be supported as market expectations shift toward our view”.