FXStreet reports that economists at Nordea said that USD is likely to outperform its peers.
“Our new calls for six 25bp rate hikes for the Fed and one 25bp rate hike for the ECB by the end of 2023 obviously have consequences throughout the bond curve.”
“Given our views on the ECB and the Fed, we also stick to our long-held view that the relative discrepancy policy-wise should lead to a stronger USD versus EUR.”
“It seems as if the debt ceiling debate is getting close to a conclusion. Furthermore, the USD often tends to perform when growth slows as USD liquidity via global trade flows is lessened from a momentum perspective – Fed tapering also pulls in the same direction.”