Dollar Index: More volunteers to support the US dollar – ING
The data confirms that the health of the US economy, and the Industrial Production report and FOMC Minutes can only fuel the flame. According to economists from ING, it’s clear that the US Dollar is the clear winner.
More volunteers are needed to help the USD.
Following an 0.5 % MoM decrease in June, industrial production should return to 0.3 % MoM expansion in July, in line with market expectations. In our estimation, retail Sales have already shown an increase of 3% in GDP in the 3rd quarter. The estimates for Industrial Production also support a further positive surprise, demonstrating the robustness of the US economy. It could be a positive sign for US Dollar.
The July Federal Reserve minutes should reflect the FOMC’s hawkish approach to counter dovish expectations. At present, this strategy is perfect. But it is just a matter of time until the Fed uses its ammunition and the market ceases to buy more hawkish information. However, we’re in this state for the next couple of days. And the positive news from the economy should remain supportive of the USD.
DXY should stay at or above 103.00 and may test higher levels towards 103.50 Today, too.
