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The US dollar index fluctuates below 103, and the market pays attention to the US CPI
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Hello everyone, today XM Foreign Exchange will bring you "[XM Foreign Exchange Official Website]: The US dollar index fluctuates below 103, and the market is paying attention to the US CPI." Hope it will be helpful to you! The original content is as follows:
On Thursday, the US dollar index hovered around 102.65, traders must wear seat belts - when the Federal Reserve's policy toolbox bottoms out and the trade war bullets fly, every breath of gold may trigger a market tsunami! Before and after the CPI data is released tonight, please make sure that the account margin is sufficient. This battle will determine who will become the winner in troubled times! In addition, it is necessary to pay attention to the changes in the number of initial unemployment claims in the United States. Several Federal Reserve officials will make speeches this trading day, and investors also need to pay attention.
Analysis of major currency trends
Dollar: As of press time, the US dollar index hovers around 102.65, and the US dollar index (DXY) hovers in the 103 range in Wednesday's trading, slightly stable after the recent selling pressure, which lowered it below 102.00. The slight rebound xmaccount.comes after the minutes of the March meeting released by the Federal Reserve (Fed), policymakers pointed to the "difficult trade-offs" in the future, citing the risks of high inflation and slowing economic growth. Technically, moving average convergence/divergence (MACD) shows a sell signal, while the relative strength index (RSI) hovers around 40, reflecting the neutral tone. Supporting the bearish view is that key moving averages such as the 20th (103.63), 100th (106.53) and 200th (104.81) simple moving averages continue to trend downward. The 10-day exponential moving average and the 10-day simple moving average are both around 103.20–103.38, which also strengthens downward pressure. Resistance is at 102.62, 103.21 and 103.38, while initial support is near 101.83. If this bottom is broken, it may expand deeper toward the psychological barrier of 100.00Retracement.
1. "Doctor Doomsday" Roubini: The Federal Reserve will not save the situation for Trump
Rurier Roubini sends a new warning to Wall Street: TradersThe bets that the Fed will step up its interest rate cuts to alleviate the impact of President Trump's trade war. Roubini, a famous economist who is known as the "Doctor Doomsday" for accurately predicting the global financial crisis, believes this time that the United States will escape the recession and that the Federal Reserve will keep interest rates unchanged for the rest of the year after the dispute over tariff-related policies eases. "This is certainly a head-on fight between Trump's and Powell's bottom," Roubini said. "But what I want to say is that the exercise price of Powell's bottom will be lower than Trump's bottom, which means Powell will wait until Trump blinks first." Federal Reserve Chairman Powell said last week that the economic impact of the new tariffs may be far beyond expectations, and the central bank must ensure that this does not trigger an increasingly serious inflation problem. This week's trading xmaccount.com members digested the Fed's expectations of 25 basis points cuts three to five times, each time, and some people on Wall Street even believed that the central bank might urgently cut interest rates before the next meeting.
2. Countdown to the "liquidity crisis" in the US bond market
The 10-year US bond yield soared to a February high of 4.515%, behind which is the terrifying signal that the direct bidding rate of sovereign buyers such as Japan reached a 15-year freezing point. When the biggest creditors may be selling U.S. bonds, gold's demand for "de-dollarization" will be boosted by the Rockets!
3. CPI may become the ultimate fuse tonight
All eyes focus on Thursday's US CPI data - if inflation exceeds expectations, the market's fear of the Fed's "longer and higher" interest rate will give gold to $3,200; if the data is weak, the expectation of an early interest rate cut will trigger a more crazy safe-haven buying.
4. Fed meeting minutes: The US economy faces the dual dilemma of high inflation and slowing growth
The minutes of the Fed's March meeting released on Wednesday (April 10) revealed a cruel reality - decision makers almost unanimously believe that the US economy is deeply trapped in the double quagmire of high inflation and slowing growth. Faced with this "diplomatic dilemma", some officials warned that they may have to make "painful choices" in the future. The meeting coincided with the Trump administration's announcement of preliminary tariff plans, and policy uncertainty increased, forcing the Federal Reserve to adopt a "cautious wait-and-see" strategy: it may maintain high interest rates for a long time due to stubborn inflation, or an emergency rate cut due to economic stalls.
5. Former Deputy Governor of the Bank of Canada: The suspension of tariffs brings a chance to breathe, but the haze of the trade war has not yet dissipated. Paul Beaudry, former deputy governor of the Bank of Canada, said that the 90-day suspension of US reciprocity tariffs represents a ease of extreme trade policies. Despite the White House’s policy changes, uncertainty will remain high as the global economy remains in a state of high tariffs. He believes that the most important thing is to observe how families and businesses deal with this situation. Institutional View
1. Citi: The suspension of tariffs cannot solve the difficulties. The United States is still facing economic slowdownAnd inflation
Citi economist Andrew Hollenhorst believes that the U.S. suspension of so-called reciprocal tariffs on most trading partners does not mean that the U.S. economy has avoided a slowdown and rising inflation. The 10% benchmark tariff that remains in effect during the 90-day suspension of reciprocity tariffs, as well as industry-specific tariffs, still raises the U.S. effective tariff rate by about 21 percentage points from the level at the beginning of this year. Trade uncertainty will continue. Citi still expects the Federal Reserve to cut interest rates in May or June.
2. Investment Bank: If bonds continue to fall, the Federal Reserve will urgently QE
Deutsche Bank said that if the turmoil that once pushed the long-term U.S. borrowing costs to more than 5% continues, the Federal Reserve will need to take action to stabilize the U.S. Treasury market. On Wednesday, doubts about the security of U.S. assets continued to escalate Wednesday, aggravated the sell-off of U.S. Treasury bonds, with the 30-year Treasury yield rising to 5.02%, the highest level since November 2023. If this continues, the Fed will need to intervene, which George Salaveros, the bank's global head of foreign exchange strategy, calls it a "circuit breaking mechanism" - that is, emergency quantitative easing. He wrote: "If the turmoil in the US Treasury market continues recently, we think the Fed has no choice but to buy US Treasury bonds urgently to stabilize the bond market."
3. Market analysis: The euro has become a safe haven outside the US dollar, but the rise may be short-lived.
Monex European analysts said in a report that after the U.S. entered into force on Wednesday, the euro became another safe haven outside the US dollar, and therefore the euro rose. However, they said the appreciation of the euro against the dollar could be short-lived. “The market has not fully considered the impact of tariffs on European economic growth and the possible impact of rising U.S. inflation on the Fed.” As the full impact of tariffs becomes apparent in the xmaccount.coming months, the expected growth and spreads of the euro against the dollar are likely to widen. Once traders realize it is a global shock, the dollar may return to its safe-haven position.
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