USD index has stabilised – Westpac
USD index has stabilised but it has overall struggled to capitalise on key positives, according to Richard Franulovich, Research Analyst at Westpac.
“Our surprise index is near cyclical highs and 10 year spreads are trending in its favour. Yet the USD remains near the bottom of its 90-105 range of the last 3 years.”
“That said, the tax bill should successfully navigate Senate procedural hurdles, sustaining hopes on that front, while constructive leading indicator signals on jobs and ISM should sustain USD positives into next week. USD risks are more two-way beyond that – lawmakers will likely focus on low hanging fruit initially during Conference Committee stage, leaving the more contentious divisions in the House and Senate bills until after next week. At that point our surprise index will be looking lofty too.”