USD remains in the downtrend - Westpac

The US dollar remains in the downtrend which started at the beginning of 2017 as the markets remain skeptical the Trump administration will achieve its tax and infrastructure plans, and that the Fed will hike much more, according to Imre Speizer, Research Analyst at Westpac.

Key Quotes

“Also looming in Sep/Oct is the threat of a government shutdown, which is weighing on the US dollar.”

“The event calendar this week will be dominated by labour data (Fri), with the PCE deflator also of some interest.”

“3 months ahead: Q4 offers a more forgiving environment for the USD than Q3. Washington is rushing into another debt ceiling and government shutdown showdown in Sep/Oct. But by Q4, these event risks will have been negotiated, seasonals are more supportive, and Trump reflation will enjoy a fresh burst of energy as Washington pivots towards tax cuts.”