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20 May 2015
Tentative signs that the US dollar may have bottomed – BTMU
FXStreet (Barcelona) - Lee Hardman, Currency Analyst at Bank of Tokyo-Mitsubishi UFJ, notes that the dollar’s downward correction has lost momentum and yesterday’s US housing starts report poured some strength in the greenback.
Key Quotes
“The US dollar has rebounded sharply over the last couple of days which appears to fit with our view that weakness had overshot in the near-term. The US dollar is now modestly higher on the month despite the continued run of disappointing US economic data releases which is another indication that the US dollar’s downward correction has lost momentum.”
“In another sign that a turning point may have been reached the US dollar derived support yesterday from the release of the latest US housing starts and permits report. The report provided the first notable upward economic surprise for some time revealing that housing starts surged by 20.2% in April rebounding strongly after weaker readings in February and March. It was encouraging as well that permits increased strongly by 10.1% in April.”
“The report has provided some reassurance that the US economy is beginning to rebound after the disappointing start to the year. Building evidence of strengthening US economic growth momentum will likely be required to drive a sustainable US dollar rebound in the coming months.”
Key Quotes
“The US dollar has rebounded sharply over the last couple of days which appears to fit with our view that weakness had overshot in the near-term. The US dollar is now modestly higher on the month despite the continued run of disappointing US economic data releases which is another indication that the US dollar’s downward correction has lost momentum.”
“In another sign that a turning point may have been reached the US dollar derived support yesterday from the release of the latest US housing starts and permits report. The report provided the first notable upward economic surprise for some time revealing that housing starts surged by 20.2% in April rebounding strongly after weaker readings in February and March. It was encouraging as well that permits increased strongly by 10.1% in April.”
“The report has provided some reassurance that the US economy is beginning to rebound after the disappointing start to the year. Building evidence of strengthening US economic growth momentum will likely be required to drive a sustainable US dollar rebound in the coming months.”