CIBC Research discusses the USD outlook and maintains a structural bearish bias.
"The record-breaking partial government shutdown will negatively impact growth in the first quarter of this year, but it also has longer-term implications. Fiscal stimulus has played a big role in the acceleration in US GDP growth under President Trump, with the biggest swing compared to Obama’s tenure coming not from tax-cut-induced consumer and business spending but direct government spending. However, current difficulties in achieving a consensus on spending among Congress suggests that this can’t be relied upon," CIBC notes.
"A slowdown in the US economy, compared to a stabilization of growth elsewhere, is likely to weigh on the US$ particularly in the second half of this year," CIBC adds
