Key to market sentiment is whether investors think the Fed will revert to caution and hold back on a June rate rise. There are many moving parts — from slowing inflation and China tightening financial conditions to commodity prices and the pace of global growth. Investors are still leaning towards the Fed going in June — but would like some reassurance. But the dollar remains vulnerable to more economic disappointment, so GDP numbers plus Federal Reserve minutes and data on home sales, jobless claims and durable goods all have market-moving potential.
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After staging a modest recovery in North America yesterday afternoon, the greenback is consolidating in narrow ranges. While Market Shrugs Off China Downgrade