US Dollar (USD) Talking Points
- Wednesday’s FOMC[1] meeting will decide the US dollar’s short- and medium-term direction.
- US dollar should remain ‘the cleanest shirt in the dirty laundry basket’.
Q2 2019 USD[2] Forecast and Top Trading Opportunity
Fundamental Forecast for the US Dollar: Neutral
The DailyFX Economic Calendar[3] covers all market moving data releases and events.
I remain Neutral on the US dollar in the week ahead as the latest FOMC meeting looms. While a 0.25% rate cut is fully priced-in for July, and should be fully signposted next week, the USD may well hold its value against its G7 counterparts who are suffering their own bouts of weakness. Saying that, expectations of a Fed policy U-turn are running high and any disappointment Wednesday may have an out-sized effect.
The FOMC monetary policy meeting on Wednesday is likely to see Fed Chair Jerome Powell indicate the start of monetary easing in the US with the first 0.25% interest rate cut likely in July or September at the latest. In recent weeks Powell has shifted his language on rate cuts from being ‘patient’ to now ‘closely monitoring’ economic conditions, leaving the central bank maximum flexibility to slash rates. Next week’s meeting is expected to confirm market expectations that rates will be lowered in July, followed by one, or maybe two, further 0.25% interest rate cuts during 2019.
DailyFX senior currency strategist John Kicklighter will be covering the FOMC Decision Live on June 19 from 17:45 GMT[4]
Political and
