USD: Likely to stay politically plagued - ING

Viraj Patel, Research Analyst at ING, suggests that USD is likely to stay under pressure as politics and bad news are keeping it down.

Key Quotes

“For the past few weeks, we’ve been working under the assumption that surely it can’t get any worse for the USD. From an economic standpoint that’s probably a fair statement; negative sentiment over the state over the US economy has been excessive, while question marks over another Fed rate hike later this year also look a bit misplaced.”

“While next week’s FOMC meeting and 2Q US GDP release could see some of this negativity ease up, US political uncertainty is now having an outright dampening effect on investor sentiment. The latest in a series of bad news to come out of Washington relates to special counsel Robert Mueller’s investigation, which media reports now suggest could extend into President Trump’s finances. In this environment, it’s hard to see anything but the $ staying on the back foot, even if further weakness may be economically unjustified.”