USD consolidation amid caution – DBS

The US Dollar (USD) rebounded slightly with DXY bumping back towards 101, DBS FX & Credit Strategist Chang Wei Liang notes.

USD consolidates amid caution

“Caution over equities could have contributed to some position paring in USD shorts, with a US mega semiconductor company reporting earnings that are not quite overwhelming.”  

“Atlanta Fed Bostic, a voting FOMC member, also stated that he would want more data to be sure if it is time to cut, and would err on the side of waiting longer given still strong employment.”

“The contrast with Powell’s speech at Jackson Hole may hint at a slower pace of rate cuts than priced by markets. USD could thus see a period of consolidation unless jobless claims surprise on the upside.”