Dollar: rebound needs stronger data – TD Cowen
TD Cowen’s Washington Strategy team, led by Chris Krueger, notes that a durable rebound in the Dollar hinges on stronger US policy follow-through and renewed upside surprises in US data. The analysts remain broadly bearish on the Dollar for now, highlighting limited upside versus the Canadian Dollar and Chinese Yuan as markets await key US payrolls and inflation releases.
USD outlook tied to data strength
"Durable USD rebound requires stronger policy follow-through & renewed upside in US data."
"US payrolls likely to post a meaningful rebound in Aug after very disappointing July showing. EUR's CPI release also top of mind for markets."
"While US rates digest the updates to the Treasury's buyback program, the curve remains flatter & term premium has dipped. US markets will focus on payrolls next week, w/ a stronger print likely to cause a sharper reaction than a subdued employment report."
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