USD: Foundations in place for stability - Westpac

Foundations are in place for USD stability as momentum gauges are deeply oversold, expectations for Trump stimulus have fallen, and US surprise indices are in key reversal zones, according to Imre Speizer, Research Analyst at Westpac.

Key Quotes

“In this week’s data calendar, July CPI (Fri) is the focus, as well as PPI and the NFIB survey. Bullard, Kashkari, Kaplan and Dudley speak.”

“3 months ahead: Q4 offers a more forgiving environment for the USD than Q3. Washington is rushing into another debt ceiling and government shutdown showdown in Sep/Oct. But by Q4, these event risks will have been negotiated, seasonals are more supportive, and Trump reflation will enjoy a fresh burst of energy as Washington pivots towards tax cuts.”