DXY: Range trade seen persisting – BBH
Brown Brothers Harriman argues that with risk sentiment likely having bottomed on March 30, the Dollar Index should revert to trading primarily on rate differentials. The bank expects DXY to remain confined within its nearly one-year 96.00–100.00 range over coming months, as markets look past the IMF’s gloomier global growth forecasts and focus on recovery.
Dollar Index expected to stay rangebound
"Markets are already looking beyond the IMF’s gloomier forecast and trading the recovery narrative. We agree."
"While the energy shock may not be over, the worst is probably behind us. If so, March 30 likely marked the bottom in risk sentiment. "
"That would leave DXY (USD index) trading off rate differentials once again, keeping the currency within its nearly one-year 96.00-100.00 range over the next few months."
"Plenty of central bank speakers are also on the docket, but with their last meetings still fresh, we don’t expect new policy guidance."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
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