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18 Sep 2014
USD keeps outperforming vs. the EUR and JPY – Rabobank
FXStreet (Edinburgh) - The ongoing USD strength promises to keep the demand for its competitors subdued, argued Jane Foley, Senior Currency Strategist at Rabobank.
Key Quotes
“After weeks of speculation it seems that the majority of FOMC members remain content to signal that rates will not be raised for a ‘considerable time’”.
“However, the trajectory of interest rate hikes into 2017 could be steeper than many had been anticipating”.
“Ultimately most forecasters that the Fed rate hike will be announced in 2015 and that the exact timing of this will be dependent on the tone of forthcoming economic data – which not even the Fed can predict with complete accuracy”.
“This has been the consensus view for some time and it remains essentially unchanged by last night’s statement”.
“Without a doubt the decisions taken by central bankers in recent years have dominated the direction of capital flows and fx rates”.
“The fact that the market is anticipating the Fed to start hiking rates next year has been a driving force behind the recovery in the USD in recent months and the greenback can currently claim to be the best performing developed world currency on both a 3 and a 1 mth view”.
“Beyond our target of USD/JPY110, we see scope for USD/JPY to rise towards 115. Our target for EUR/USD stands at 1.25”.
Key Quotes
“After weeks of speculation it seems that the majority of FOMC members remain content to signal that rates will not be raised for a ‘considerable time’”.
“However, the trajectory of interest rate hikes into 2017 could be steeper than many had been anticipating”.
“Ultimately most forecasters that the Fed rate hike will be announced in 2015 and that the exact timing of this will be dependent on the tone of forthcoming economic data – which not even the Fed can predict with complete accuracy”.
“This has been the consensus view for some time and it remains essentially unchanged by last night’s statement”.
“Without a doubt the decisions taken by central bankers in recent years have dominated the direction of capital flows and fx rates”.
“The fact that the market is anticipating the Fed to start hiking rates next year has been a driving force behind the recovery in the USD in recent months and the greenback can currently claim to be the best performing developed world currency on both a 3 and a 1 mth view”.
“Beyond our target of USD/JPY110, we see scope for USD/JPY to rise towards 115. Our target for EUR/USD stands at 1.25”.