The greenback leads the way as we begin the European morning

(Grr... post earlier had an error and I have to retype all of this)

WCRS 23-07

The dollar is the lead gainer as we begin the session, helped in part by the fact that a debt ceiling deal was struck but I reckon more so on flow-based momentum in anticipation of the FOMC meeting next week.

Despite that, Fed funds futures still indicate a 19.5% probability of a 50 bps rate cut on 31 July and in my view, that's 19.5% too much. Hence, there is still some scope for the dollar to gain further should those expectations recede.

That said, without Fedspeak on the agenda, it'll be hard to see what may help to shift the dial in that respect ahead of next week's meeting.

Other major currencies are little changed against one another but the kiwi is the notable loser as the currency declined after a report indicated that the RBNZ is starting to explore more unconventional policy.

It's all about central bank rhetoric right now and with the Fed looking to begin loosening monetary policy, all other central banks around the globe will have to follow suit. There's dovish rhetoric everywhere and it's very much a race to the bottom from hereon.

On your mark, get set, goooo~!

Race