The Dollar likely faces downside risks – ING
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The Dollar has essentially erased all the post-FOMC losses. But today’s Nonfarm Payrolls release in the US brings mostly downside risks for the Dollar, in the view of economists at ING.
“With volatility abating after the key Fed and ECB announcements and some of those defensive trades being unwound, today’s NFP release in the US brings mostly downside risks for the USD.”
“Any evidence that wage growth is losing pace and/or that hiring is slowing down materially would likely fuel rate cut expectations further, and hit the Dollar.
“US 2-year rates are currently trading 10 bps above the psychological 4.00% mark: a break below may exacerbate a Dollar slump. Should such USD weakness materialise, we think that high-beta currencies may emerge as key winners thanks to the positive impact on risk assets.”
See – US NFP Preview: Forecasts from eight major banks, another healthy gain
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