Michael Woolfolk
Michael Woolfolk
bank canadian continues dollar federal hike narrow rates reserve
If the Bank of Canadian continues to hike rates after the Federal Reserve pauses, it will narrow the rate differential between the two. This will make the Canadian dollar more favorable.
asian bank central continued demand elevated ensures foreign oil prices remains strong
We see that elevated oil prices and a continued Asian central bank intervention ensures that foreign demand for U.S. treasuries remains strong during January.
china continue currency deficit energy enthusiasm firmly further improvement lasting market prices remains resistant rise trade unexpected
While the US trade deficit showed an unexpected improvement in February, any lasting market enthusiasm was firmly misplaced. Energy prices continue to rise while China remains resistant to further currency flexibility.
below continue data fed labor likely market raising rates remains services support view
February's data support the view that the U.S. labor market remains strong, particularly on the services side, with unemployment solidly below the 5% level. The Fed is likely to continue raising rates for the foreseeable future.
continue economic expected fed heads interest political rates report rising risk strength underlying
The monthly GDP report fed into underlying CAD strength. With political risk subsiding, rising interest rates and fundamental economic strength are prompting CAD buying, which is expected to continue through year-end as USD/CAD heads for the 1.10 mark.
continued fully globally hike hikes interest march positive rate talk
The hike in March is fully priced in. The hike in May is over 80% priced in. There is already talk of continued hikes after that. Interest rate differentials globally are increasingly favoring the U.S. and it's positive for the dollar.
against banks central continue dollar intervene overseas remain supported time weak
The dollar will remain supported for the time being so long as central banks overseas continue to intervene to keep their currencies weak against the U.S. dollar.
continued dollar importance interest labor market rally rate report respect
The dollar rally after the non-farm payrolls report underscores the continued importance of labor market tightness with respect to interest rate expectations.
continue dips fed indicate inflation likely raise wage
If unemployment dips any lower, that may indicate some wage inflation and the Fed will likely continue to raise rates.
change consistent data fed
Our Fed watchers say there's a consistent story that the Fed is one and done. Today's data doesn't change this story.
backing dollar economic economy likely rate strong
There are strong economic fundamentals backing not only the U.S. economy but the U.S. dollar right now. We are likely to get two more rate hikes.
caught data heavy market players week wrong
Market players don't want to be caught the wrong way here going into a very heavy data week in the U.S..
below compelling concerned drifted further hike interest levels next rates reason start
Unemployment has drifted further below 5 percent, and at those levels you have to start being concerned about bidding up of wages. There's a compelling reason to hike interest rates at the next meeting.
exceeded knew september turn worst
We knew that there were going to be some hurricane-related distortions in the September data, but this really exceeded our worst fears. This was a turn for the worst.