Economists at ING analyze US Dollar (USD) outlook after comments from Atlanta Fed’s Raphael Bostic
The mood music coming through from the Fed remains one of there being no rush to cut rates. On Monday, Atlanta Fed President Raphael Bostic talked of there being ‘pent-up exuberance’ in the business sector, which could be a problem for inflation if the Fed cuts too quickly.
Bostic’s comments feed into the prevailing view that the Fed is in no rush to cut rates and that this view will likely be echoed when Fed Chair Jerome Powell testifies to the House Financial Services Committee on Wednesday.
We doubt today’s US ISM Services data for February will be a major market mover, although a repeat of the strong January release would be Dollar-positive. And we see DXY continuing to find support under 104.00.