TD Research discusses the USD outlook and sees a scope for further consolidation in the near-term.
"Risk markets have a little less pep in their step this week, reflecting some shifts in the short-run narrative. We think the bar for a temporary setback remains low, leaving the USD some room to consolidate. For starters, against the G9, it's trading at the same discount on our short-term models witnessed in 2017 in spite of the raft of uncertainty present at the moment," TD notes.
"A reduction in this discount would benefit the USD by about 2-3%, which we think would an attractive selling opportunity if realized in the weeks ahead," TD adds.