US dollar faces more and more obstacles on upward path

Posted 05 December, 2018

Following the upturn, the US dollar has slowed downs somewhat on Wednesday, and now the trend is unclear, though mostly positive one. There is no notable boost, but the markets show some jitters.

This situation can be partly connected with the overestimated results of the Washington-Beijing meeting since the initial state of bliss changed into sceptical mood regarding the success of the achieved agreements during the trade negotiations between the countries. Investors do not dare to include fast settlement of the conflict into the price seeing no details of the agreement as well as unclear statements of countries' leaders.

As a result, these doubts are said to bolster greenback positions as a protective asset. Moreover, certain influence is seen from the lack of state bonds dynamics today. Specifically, changes of US Treasuries yield have become an important factor lately – debt securities market is closed today due to the National Day of Mourning for George HW Bush. At present, the sentiments regarding Treasuries are among the key risk factors for the dollar as well as the topic for the market discussions, since the figures give a clearer picture of the future recession.

The US dollar can see some support from the Beige Book to be released by the US Federal Reserve in the near term unless the authority shares its concerns about possible economic slowdown. With this scenario, fears of monetary tightening suspension will fade away. In the long run, the US dollar will probably face increasing bearish risks with more complicated upward moves, according to market experts.

Previous forecast

06 December, 2018 16:14

← Uncertainty prevails in oil market on upcoming OPEC+ meeting

Uncertainties persist in the oil market ahead of the fateful decision of the OPEC+ members regarding a widely discussed reduction of oil production. The market keeps fluctuating in this context, while prices are highly sensitive to different rumours and speculations. Volatility stays strong in the market on Thursday. Following the recent fruitless attempts to take roots above $63-handle, Brent prices plunged to some $60.16 today. It seems that prices are likely to keep sliding further below $60 handle. The rumours that the cartel committee suggested a 1 million bbl reduction as well as agreed on new measures have been rejected, and even before the market has responded to them.

Uncertainty prevails in oil market on upcoming OPEC+ meeting

Next forecast

05 December, 2018 14:01

New US threats against China despite agreed break in conflict →

US President, Donald Trump is said to threaten Beijing with new import restrictions. The White House backs to its normal political messages, and this even since before the 90-day break period for intensive US-China talks achieved during the G20 summit failed to begin. For reference, it was agreed that the parties take a pause in an interchange of import duties beginning from January 1 2019. Specifically, as the US leader stated in the social network, there will be a real deal or nothing.

New US threats against China despite agreed break in conflict
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