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Dollar Hobbled; Technicals Warn of More Losses
The US dollar advance was stopped in its tracks by the disappointingly weak Q2 GDP figures. The 1.2% annualized growth rate was roughly half of the pace expected. The FOMC statement earlier in the week did not leave the impression that a September hike was likely, and with the poor growth numbers, the odds were downgraded further. Now given the reduced contingent risk of a September hike, the odds of a hike 50-75 bp end of the year target range for Fed funds has fallen to about a 1 in 3 chance. However, if you think that there is no chance of a September hike (doubts about the economic strength) or a November hike ... (full story)