FOMC minutes can keep the Dollar supported – ING
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The release of the February FOMC minutes provided little comfort to Dollar bears. Economists at ING expect the greenback to remain on a solid foot in the near term.
“The minutes were largely hawkish. The consensus agreed that further rate increases were needed and that inflation remained unacceptably high. There were no hints of a pause and very little to divert market pricing of three more 25 bps hikes from the Fed over the March, May and June meetings. This backdrop can keep the Dollar supported in the near term and potentially into the 22 March FOMC meeting.”
“For Dollar bears, both activity and price data will have to soften over the coming weeks to make an impact on an otherwise hawkish Fed.”
“Our first quarter game plan is that DXY does not hold onto these gains. But for the time being, it looks like DXY wants to probe higher to the 105.00 area with outside risks this quarter to the 106.00/106.50 area.”
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