USD expected to remain strong this week – Danske Bank

Senior Analyst at Danske Bank Morten Helt sees the greenback staying strong so far this week.

Key Quotes

“USD looks set to stay strong into this week’s midterm election after a decent jobs report kept alive the sense of US growth outperformance and hinted that the ECB is contemplating a new TLRO”.

“In the event of a split Congress following the midterms (results due Wednesday morning), USD should stay bid but still remain in a range around 1.15 on a 3M horizon, as any new fiscal boost should be confined to infrastructure and as continued trade talks with China are likely”.

“Hence, we still think EUR/USD could be in for a break of 1.13 near term – not least if the Fed keeps up its tightening rhetoric this week despite the recent risk sell-off”.