The USD is the worst performing G10 currency as we come to the final days of December and the end of the decade.
DXY broke below the 96.750 level (US dollar index) which is its lowest in 6 months.
The catalyst of the weaker dollar has likely been risk appetite holding up since both the US and China said that they were ready to sign a Phase 1 deal;
as well as the US Federal Reserve’s continued repo operations, which have recently been undersubscribed.
US Yields are expected to extend their grind higher in Q1 and a weaker USD should continue to support Commodity strength. Gold & Copper continue to be bullish and have established a base.
A weaker USD and stronger Commodities are expected to support Emerging Markets equity strength, with MSCI EM China crucially now also breaking higher.
DXY broke below the 96.750 level (US dollar index) which is its lowest in 6 months.
The catalyst of the weaker dollar has likely been risk appetite holding up since both the US and China said that they were ready to sign a Phase 1 deal;
as well as the US Federal Reserve’s continued repo operations, which have recently been undersubscribed.
US Yields are expected to extend their grind higher in Q1 and a weaker USD should continue to support Commodity strength. Gold & Copper continue to be bullish and have established a base.
A weaker USD and stronger Commodities are expected to support Emerging Markets equity strength, with MSCI EM China crucially now also breaking higher.
