OctaFX | OctaFX Forex Broker
Open trading account
Back

US: Rate hike bets reincarnated by upward revision to GDP growth - MUFG

FXStreet (Delhi) – Lee Hardman, Currency Strategist at MUFG, notes that the recent upward revision to US GDP growth is further supporting the case for rate hike.

Key Quotes

“The US dollar has remained on a stronger footing in the Asian trading session after rebounding modestly last week supported by comments from Fed Chair Yellen that she still favours beginning to raise interest rates this year.”

“The release on Friday of the latest US GDP report for Q2 also provided more support in favour of beginning to reverse the current emergency policy settings. The report revealed that the US economy rebounded more robustly than initially estimated by an annualized rate of 3.9% in Q2 following the temporary slowdown in Q1. As a result the US economy continued to expand at an above trend annualized pace of 2.3% in the first half of the year prompting a further erosion of spare capacity.”

“It has been the strongest four consecutive quarters of personal consumption growth since the year up to the end of Q2 2006. The sharp decline in the price of crude oil is helping to support economic growth and providing an offset to external headwinds to growth from the stronger US dollar and weaker external demand as emerging economies continue to slowdown.”

“The strength of personal consumption growth will provide further reassurance to the Fed that the US economy is unlikely to be significantly negatively impacted by building downside external risks to growth. It supports the case for widening monetary divergence between the Fed and overseas central banks and resulting stronger US dollar.”

Spain – Catalonia elections add to uncertainty - Deutsche Bank

Research Team at Deutsche Bank, note that over the weekend was the Catalonia election where pro-independence parties Junts pel Si and CUP have won the majority of seats in parliament, but have fallen short of the required number of votes for majority which is adding to the uncertainty about its existence in Spain.
Read more Previous

USD/NOK posts 52 week high

USD/NOK posts 52 week high
Read more Next
Start livechat