The main money rates remained relatively stable overnight after last week's modest rebound for the US dollar. He ended the round of four consecutive weekly decrees for the dollar index which raised the level of 100.00 after reaching a year lower by 97.921 on April 25, notes the Mufg Lee Hardman FX analyst.
The US dollar stabilizes after a recent drop
“The US dollar supported last week from the construction of investors optimism according to which President Trump could still reverse the disruptive trade policies he has implemented in his second mandate in the coming months, in particular by considerably reducing the current” unsustainable “rate of 145% for imports from China. Prices for the “Liberation Day” on April 2 “.
: Improvement of investor confidence in the development of American policies was also obvious by last week's performance of American bonds and stock markets. The S&P 500 sharing index continued to bounce and now reversed most of the losses initially suffered following the announcement of the “Liberation Day” prices when it dropped by almost 15%. Likewise, the US bond market has rebounded since American returns reached a summit on April 9. The 30 -year -old American treasury yield dropped around 4.70% by moving further below the year to date 5.02%. However, we do not remain convinced that the turnover policy has announced so far will be sufficient to trigger a sustained rebound for the US dollar with current rate rates still extremely disruptive for world trade and the US economy. “”
“The dominant comments of Fed officials at the end of last week have indicated that they were ready to reduce rates if the risk of drop for growth is materialized. The governor of the Fed Waller said:” It would not surprise me that you can start to see more layoffs, a ICT in the unemployment rate in the future if the major rates in particular come back. The side of the use of the mandate, I think, is important that we were entering. “However, it does not expect the prices to have a significant impact on the American economy before July, indicating that it is currently favorable to the expectation of the September FOMC before starting to reduce the rates unless the labor market is weakening more quickly than expected.”
