dollar outlook

2017 GDP Growth and CPI Inflation in the U.S., Euroland and Japan

February 20, 2018

Economic growth slowed last quarter from the summer’s pace in the United States, Euroland and Japan but, also in each case was stronger in calendar 2017 than in 2016. U.S. GDP rose 2.6% at an annualized pace between 3Q and 2Q, down from 3.2% in the previous quarter and reflecting a combined 1.8 percentage point […] More

U.S. Populism Already Depressing the Dollar

November 28, 2017

The dollar has lost approximately 13% against the euro, 6% relative to the yen, and 9% on a trade-weighted basis compared to its strongest levels since the November 2016 U.S. election. The dollar has declined so far this quarter by a bit about 2% against the common European currency on top of a 3.3% drop […] More

Dollar Image Still Eroding

July 23, 2017

The initial advance of the dollar after Donald Trump’s election has been erased. The euphoria had stemmed from a belief that federal government policy would be legislated more easily with single party control and that the Trump proposals of tax relief, financial market deregulation, fair trade, and infrastructure repair would lift productivity, shrink the trade […] More

Some Factors to Consider When Handicapping Dollar’s Outlook

February 21, 2017

Fake News that is likely to become even more prevalent will present many challenges to currency forecasters. Even if the U.S. press and the intelligence community try to stand their ground, the executive branch of government enjoys great advantages in creating doubt and confusion in the public’s mind over what to believe. The two watchdogs are […] More

Dollar Uptrend Back on Track

February 15, 2017

The dollar is back in the saddle. After a strong performance last autumn, the dollar hit a speed bump in January but experienced solid demand in the first half of this month. Against both the euro and yen, the U.S. currency posted gains in each month of last quarter. So far in February, it has recovered […] More

2016 Market Movements Before and After the U.S. Election

December 29, 2016

The U.S. election on November 8th was a turning point for many financial market instruments. The ten-year Treasury yield had declined 41 basis points to 1.86% between the end of 2015 and the election. This was twice the net increase registered in calendar 2015. Since the election, the yield has climbed 63 basis points. Since […] More

Currency Landscape as 2015 Draws Nearer to Completion

December 21, 2015

The past twelve months have seen the U.S. currency strengthen broadly but most sharply against emerging market and commodity-sensitive currencies.  Net dollar changes since end-2014 or -0.1% against the Swiss franc, +1.3% versus the Japanese yen and +4.5% relative to the British pound were generally modest, while advances of 11.2% vis-a-vis the euro, 14.3% against […] More

How High Might the Dollar Climb?

December 2, 2015

December figures to be a watershed month for the dollar, since the divergence of monetary policies is likely to become significantly wider.  That’s a hugely positive development for the dollar in theory.  In anticipation, market participants bid the dollar up slightly more than 4.0% in November against the euro and Swiss franc and between 2% […] More

EUR/USD and the Price of Oil

October 14, 2015

EUR/USD and the price of oil (West Texas Intermediate) have moved more or less inversely since the cost of energy peaked in June 2014.  This correlation can been observed in the table below of month-end to month-end changes in the dollar against the euro and of the price of oil.  The direction of change in […] More

End-Summer Thoughts

September 8, 2015

Unusual properties to summer financial market activity subdivide foreign exchange trading into three uneven seasons.  The unofficial summer for traders is bordered by the U.S. Memorial Day and Labor Day holidays.  Without going into what makes the summer different, an important take-away is that it’s a time of year to be generally a little bit […] More