BoA/ML highlight risk of USD intervention

Author: Eamonn Sheridan | Category: News

A client note from Bank of America / Merrill Lynch say that there is a rising risk of intervention from the US to combat a strong US dollar.

Trump administration would couch such intervention in terms of USD stabilisation.

BoA add that this intervention is not their base expectation

  • Says USD is overvalued, real effective exchange rate around 13% above long-term average
  • If easing from the Federal Reserve does not lower the USD, nor jawboning, the next step risk is 'formal currency intervention'
  • 'the risks are rising'
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DXY:

A client note from Bank of America /Merrill Lynch say that there is a rising risk of intervention fromthe US to combat a strong US dollar.


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