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Thomson Reuters
Jul 18 - 09:48 AM
USD: Set To Remain Bid On Trade War; EUR/USD Vulnerable To Slide Towards 1.15 - Danske
First appeared on eFXplus on Jul 17 - 04:50 PM

Danske Research discusses the USD outlook and flags further strength on the back of ongoing trade tensions.

"When the trade issue surfaced at the start of the year, the US rhetoric was largely associated with a political push for a weaker USD but lately regular economic channels have started to take over. This has changed the impact of trade tensions on, notably, the USD.

Near term, the scorecard highlights the case for USD support if the trade dispute escalates.

The Scandi currencies and the EUR are particularly vulnerable. While EUR/USD could slide towards 1.15 on this, we do not see much further downside in the cross than that from the ECB already being dovishly priced and the Fed increasingly alert to the negative impact of a trade war," Danske argues. 

Source:
Danske Research/Market Commentary

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