US Dollar (DXY) Probes a New 20-Year High, US Q1 GDP May Disappoint

US Dollar (DXY) Daily Price and Analysis

  • US Q1 GDP might stall the dollar’s advance.
  • A 20-year excessive nears for the US greenback.

The multi-month US greenback rally continues with the dollar printing a contemporary excessive at the moment forward of the primary take a look at US Q1 GDP at 12.30 GMT. The US greenback basket (DXY) has been boosted by renewed weak point within the Euro and the Japanese Yen, as traders transfer from lower-yielding to higher-yielding currencies, whereas safe-haven flows proceed to profit the dollar.

The US development launch later within the session is anticipated to point out a pointy slowdown from the strong This autumn determine of 6.9%. The markets are at present pricing in development of simply 1% for the primary three months of this yr, with the slowdown primarily because of a discount in stock accrual over the quarter. This launch is unlikely to maneuver the dollar, except there’s a massive miss or beat, because the Fed imagine that 2022 US development shall be strong sufficient to allow them to tighten financial coverage sharply with out damaging the financial system. The newest US Core PCE knowledge – the Fed’s most popular inflation studying – is launched on Friday and this will likely have extra impact on the US greenback than at the moment’s GDP knowledge.

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The ongoing US greenback rally has been aided by weak point throughout a variety of G7 currencies together with the Euro, the Japanese Yen, and the British Pound. The Euro continues to battle with lowly development expectations, exacerbated by vitality issues, the British Pound is mired by weak financial knowledge, whereas the Japanese Yen is in freefall because the BoJ continues with its ultra-loose financial coverage.

The US greenback continues to press increased and appears set to interrupt above 103.96, the March 2020 excessive. Above right here the US greenback can be again at ranges final seen practically twenty years in the past. The March resistance will seemingly maintain within the short-term, particularly with month-end portfolio rebalancing on the finish of the week, however US greenback energy is ready to proceed within the months forward.

USDollar (DXY) Weekly Price Chart – April 28, 2022

US Dollar (DXY) Probes a New 20-Year High, US Q1 GDP May Disappoint


What is your view on the US Dollar – bullish or bearish?? You can tell us through the shape on the finish of this piece or you may contact the writer through Twitter @nickcawley1.

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