Dollar's near-term outlook bright, but faded in a year: Reuters poll.

           

                    Us dollar

Dollar's near-term outlook bright, but faded in a year: Reuters poll.

The near-term bets should be increased in favor of the dollar, said most analysts polled by Reuters, who were however divided on the greenback's bullish trend period and forecast its attractiveness to fade in a year.

Us dollar 

Tracking the Federal Reserve's surprisingly bullish outlook at the June meeting, the dollar ended its two-month streak and gained nearly 3% against a basket of currencies last month, averaging 4-1/2 years. marks its best monthly performance in the.

The dollar and other safe-haven assets - including the Treasury and the yen - have also supported the spread of the highly contagious delta version of COVID-19, threatening a global reopening.

Us dollar 

Nevertheless, a June 28-July 1 survey of more than 70 forex analysts showed that the US currency will weaken against most major currencies in 12 months' time, a view held for more than a year.

But in response to an additional question, nearly 75% of analysts, or 38 out of 51, recommended long dollar bets and short other major currencies or emerging market ones as a positioning strategy over the next three months.

Us dollar 

"We are in a dollar positive regime for the next few months, which will generate some dollar strength in the near term. But over the long term, we expect the dollar to remain in a fairly broad-based range," David said. Adams, Head of G10 FX Strategy North America at Morgan Stanley.

“This summer we see an opportunity for a tradable dollar rally as real rates rise and break-even inflation rates fall. CFTC data and our conversations with investors show that the market is still bearish on the dollar. , both in the real situation and in the spirit."

When asked how long the dollar's strength would last, 37 out of 63 analysts said that in less than three months, eleven had predicted it was already over. The remaining 26 said more than three months.

Us dollar 

It underscores the uncertainty from the pull and push in expectations between the announcement of the Fed's taper plan - which separate Reuters polls forecast to come by September - and the outlook for the U.S. The central bank won't start scaling back its stimulus until next year.

"With equity markets at advanced levels and housing markets heating up in many countries, we've got fertile grounds for people to worry. COVID and the Fed are the focus ... the Fed is focusing us on economic data that's hard have to explain,” said Kit Jux, Head of FX Strategy at Société Generale.

"The Queen in Alice in Wonderland said she sometimes believed six impossible things before breakfast and I suspect we're all going to be to blame for this summer... although the fundamental picture is still that FX There's a fight between the global economic recovery, and the Fed's talking hard."

The long-held outlook for a weaker dollar in the coming year was once again broad consensus in the latest poll, with the euro predicted to rise 2.6% in a year to $1.22, a gain of nearly 4-1/2-months. was from a lower level. $1.18 on Thursday.

Us dollar 

While the consensus 12 months ahead is lower than last month's prediction, it only reflects the single currency's significant decline in June, driven by the Fed's bullish tone on hopes of a stronger economic recovery, supporting the dollar. is.

"Right now you have the worst of all worlds: the Fed is extremely loose, inflation is high and real interest rates are more negative in the U.S. than they are in other places...what you really need to turn the dollar around is the prospect of Fed raising rates."

Us dollar 

Source by internet.

Created by MOHAMMAD SHOAIB.