• Email Us: [email protected]
  • Contact Us: +1 718 874 1545
  • Skip to main content
  • Skip to primary sidebar

Medical Market Report

  • Home
  • All Reports
  • About Us
  • Contact Us

Dollar lost for direction awaiting Fed to set its path: Reuters poll

September 3, 2021 by David Barret Leave a Comment

September 3, 2021

By Hari Kishan

BENGALURU (Reuters) – The dollar’s direction is in limbo as financial markets await a clearer path from the U.S. Federal Reserve, according to a Reuters poll of FX strategists who were split on where they expected the currency to trade over the next three months.

On the back foot even before Fed Chair Jerome Powell’s comments last Friday at Jackson Hole, the greenback has lost almost 1.4% since it hit a nine-month high about two weeks ago. But it is still up around 3% for the year.

While analysts in the Aug. 30-Sept. 2 poll of nearly 60 FX strategists expected the greenback to give up most of those gains over the coming year, they were increasingly uncertain about both the short- and medium-term outlook.

“There’s two important forces when we look at the direction of the dollar. The first is the global recovery and the momentum we’ve seen most recently and the second point is obviously the central banks’ response to that,” said Kerry Craig, global market strategist at JP Morgan Asset Management in Melbourne.

“Because those two forces are competing at the moment, we’re relatively neutral about the direction of the U.S. dollar.”

Eventual Fed tapering of its $120 billion of monthly bond purchases, which an over 75% majority of 51 analysts expected the central bank to announce in the final quarter of this year, should help U.S. Treasury yields to move higher.

“Ultimately, we think in a world where real yields will continue to rise over the coming months, it’s likely to be dollar positive,” said David Adams, head of FX strategy in North America at Morgan Stanley.

“We continue to be dollar bullish, particularly versus the low yielding funding currencies – that would be the Japanese yen and the euro.”

Data from the U.S. Commodity Futures Trading Commission released on Aug. 27 showed speculators had once again increased their net long U.S. dollar positions.

But underscoring the prevailing uncertainty, there was no consensus among analysts who answered an additional question on how the dollar would trade over the next three months.

Although 23 of 60 strategists said they expected the currency to trade around current levels, 25 said broadly higher. The remaining 12 chose broadly lower.

While sticking to their long-held view of a weakening dollar over a 12-month horizon, analysts were turning skeptical.

Asked how confident they were in that view, 62% of strategists, 36 of 58, said they were not confident or not at all confident. Twenty-two chose confident.

With most major currencies expected to strengthen against the dollar in the next 12 months, the euro was forecast up a little over 2% for the same period. The common currency is down 3% this year.

Most emerging market currencies were also forecast to weaken or at best cling to a range over the next three to six months as U.S. stimulus withdrawal could push investors to shun the currencies coined the “fragile five” – Turkey, South Africa, Brazil, India and Indonesia – as they did in 2013. [EMRG/POLL]

“The dollar tends to weaken when we have a lot of risk appetite, pulling money into emerging markets and what we’ve seen recently is the Delta variant really shaking up Asian markets and that degree of uncertainty has been amplified by this tapering debate,” said Jane Foley, head of FX strategy at Rabobank in London.

“It is a combination of those two factors that have seen flows being pulled back to the dollar. In order for the dollar to weaken again we would have to have a huge amount of flows going into emerging markets, and I can’t see that happening imminently.”

(For other stories from the September Reuters foreign exchange poll:)

(Reporting by Hari Kishan; Polling by Susobhan Sarkar and Mumal Rathore; Editing by Ross Finley and Steve Orlofsky)

Source Link Dollar lost for direction awaiting Fed to set its path: Reuters poll

David Barret
David Barret

Related posts:

  1. China’s Alibaba to invest $15.5 billion towards “common prosperity”
  2. Stars return to Venice red carpet as film festival opens
  3. South African train brings COVID-19 vaccines closer to people
  4. Marvel’s Blade director has been confirmed – by the man himself

Filed Under: News

Reader Interactions

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Primary Sidebar

  • This Pill Is Actually A Tiny Printer That Repairs Internal Injuries Using Biocompatible Ink
  • “This Is Amazing”: Scientists Have Found Evidence Of A Long-Lost World Deep Within The Earth
  • From The Shiniest World To Lava And Eternal Darkness, These Are The Weirdest Known Planets
  • Do Sharks Have Bones?
  • The Zombie Awakens: A Volcano Is Showing “First Signs” Of Unrest After 700,000 Years Of Quiet
  • Two Of The World’s Biggest Earthquakes Seem To Be Synched Together
  • California Has A New State Snake, And It’s A 1.6-Meter-Long Giant
  • Experimental Nanoparticle “Super-Vaccines” Stop Breast, Pancreatic, And Skin Cancers In Their Tracks
  • New Nightmare Fuel Unlocked: Watch The First Known Capture Of A Shrew By A False Widow Spider
  • Peculiar Glow In The Milky Way Might Be Dark Matter Signature
  • “I Was Scared To Death”: Missouri’s Great Cobra Scare Of 1953 Was Eventually Solved After 35 Years
  • Two Spacecraft To Fly Through Comet 3I/ATLAS’s Ion Tail – Will They Be Able To Catch Something?
  • Pioneering Heavy Water Detection Suggests Earth’s Water Might Be Older Than The Sun
  • PhD Students’ Groundbreaking New Technique Rescues JWST’s Highest Resolution Data
  • Popcorn-Like Parasites And Weird Worms Among 14 New Species Discovered In The World’s Oceans
  • Poem From 1181 CE Cairo Appears To Reference A Rare Galactic Supernova
  • With “Iridescent Live Colors”, Newly Discovered Beautiful Dwarfgoby Lives Up To Its Name (Mostly)
  • “Anti-Tail” And Odd 594-Kilometer Feature Found On Interstellar Object 3I/ATLAS By Keck Observatory
  • Why Do We Call It A “Hamburger” When It Doesn’t Contain Ham?
  • What Aristotle Got Wrong About The Octopus
  • Business
  • Health
  • News
  • Science
  • Technology
  • +1 718 874 1545
  • +91 78878 22626
  • [email protected]
Office Address
Prudour Pvt. Ltd. 420 Lexington Avenue Suite 300 New York City, NY 10170.

Powered by Prudour Network

Copyrights © 2025 · Medical Market Report. All Rights Reserved.

Go to mobile version