Michael Woolfolk
Michael Woolfolk
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.
against appears conditions dollar ideal lows movements prices push spot supported testing
These are ideal conditions for speculators to push spot prices around. The dollar appears to be testing new lows against the yen. The price movements are not supported by fundamentals.
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.
asian bonds conscious demand dollar greatest market policy remains soon threat time unlikely whereas
Whereas Asian demand for US bonds is unlikely to end any time soon as a conscious policy decision, the reversal of petrodollars from the US bond market remains the greatest threat to the dollar in 2006.
dollar fed markets trend until
We won't see the dollar embarking on any new trend until the markets get a better sense of where the Fed is headed.
account bush capable current cutting decline deficit destined unless
Unless the Bush administration is capable of cutting the current account deficit in half, the dollar's decline is destined to continue.
believe curve people recession signal wrong yield
The people who believe that the inversion of the yield curve is a signal of recession have it wrong this time.
durable favorable gains given goods growth interest january market positive rate recent unlikely weigh
Given the recent spate of positive January data, CPI and durable goods are unlikely to disappoint. The USD is positioned to make new gains ... as favorable U.S. growth and interest rate differentials weigh on market sentiment.
market tape
But the tape will not be as important to the market as new data.
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.