The median estimate is for a +2.3% q/q headline reading

US GDP

Markets are awaiting with abated breath ahead of the release here in hopes that it will help provide some fresh direction for traders to act upon. The range of expectations for the release is between +1.0% to +2.9%, with 45% of economists expecting the headline reading to be somewhere between +2.0% to +2.6%:

US GDP

Given the dollar's hot run this week, the release provides a relatively straightforward case in terms of what the market reaction will be. A much stronger beat (somewhere around +2.6% or higher) will help keep the dollar underpinned and likely push up risk assets alongside it as well. On the flip side, a much weaker reading (anything under +2.0%) should see the dollar offered and markets getting jittery about a deepening in the global growth slowdown.

In the latter scenario, the yen is most likely to thrive and I reckon the dollar may yet recover some ground down the road on the back of haven flows.

As for a release within expectations, I would expect the dollar to hold its ground in the aftermath in the event of an initial pullback. The details are likely to matter more here so be wary of the core PCE reading as well, which is expected to soften slightly compared to the final quarter of last year.