Forex Top Team

Last week, a series of weak PMI announcements

In the latter half of last week, weak PMIs from Europe and the United States were announced one after another. The market was nervous each time, with the worsening business sentiment in Europe such as Germany selling euros and buying dollars, and the sharp deterioration of US non-manufacturing PMI selling dollars and buying euros. The dollar index has lost its direction. The last ECB board announced a 0.5% rate hike, and this week’s US FOMC has seen a 0.75% rate hike as market consensus. There are still some observations of a 1.00% rate hike. In terms of change, the impact of the ECB Board, which started raising interest rates for the first time in 11 years, won, but uncertainty over the TPI conditions at the ECB Board slowed euro buying. In terms of interest rate differentials, it seems that the composition of widening interest rate differentials between the United States and Europe remains unwavering.

FOMC 1.00% rate hike remains, but 0.75% is influential. From here on, the USD is expected to continue its weak development this week.

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