USD bear market of bull market?

Author: Giles Coghlan | Category: News

ING see USD in broader bear market

ING see USD in broader bear market

With the USD rally taking a pause it is worth reading around on those who see the recent USD strength as merely a USD correction., like the folks over at ING. They do see the latest pop in the USD since the start of the year as a USD bear market bounce. Their call is that the current correction in the USD will provide some decent levels to rejoin the USD as a core seller.

The summary of their position is as follows:

They see the dollar rally as a bear market bounce and remain fully invested in a Q2 story of a broadening global recovery to lift all currencies - including the EUR. They see a EURUSD correct dip to 1.17/1.18 to be followed by a recovery to 1.25 in the summer. They also like GBP strength. It is worth mentioning that their piece was before the COVID-19 surge in eurozone cases, so that may skew the pitch on this as it was their March outlook. A key risk that I can see to their view is that bond tapering starts to be spoken about soon and that should be USD positive.

ING see equity and commodity gains having much further to run (which would be helped by a weaker USD).

Read their full piece here

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