US Dollar Index: Too early to call a peak in the multi-month bull trend – Westpac

A more consistently hawkish-sounding European Central Bank (ECB) and China reopening neutralised the US Dollar Index (DXY) upside. However, it is still too early to call a long-term DXY peak, in the opinion of economists at Westpac.

More hawkish ECB countering the Fed for now

“China reopening hopes, rate hike rethink in the US and a decidedly more hawkish ECB have neutralised USD upside recently.” 

“The greater risk is surely that the ECB does not deliver against rate expectations than the Fed.”

“DXY could ease back as far as 100 near-term, but it’s still too early to call a peak in the multi-month bull trend.”