US Dollar May Rebound vs. Euro as Fed, ECB Policies Diverge | Forex Factory

  • US Dollar May Rebound vs. Euro as Fed, ECB Policies Diverge

    From dailyfx.com

    The US Dollar soared at the onset of the Covid-19 pandemic as panicked credit markets began to seize up, sending capital scrambling for the reserve currency’s ultimate liquidity. It then turned sharply lower as the Federal Reserve forcefully pushed back, deploying massive stimulus at an unprecedented rate to unclog the pipes and becalm investors. It appears to have worked: credit spreads narrowed and market sentiment recovered. That this success came at the expense of the Greenback seems to make sense. First, the sheer size of the Fed’s effort exceeded that of other central banks. Second, that markets took this ... (full story)

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herewardwake
Dec 27, 2020 12:11pm
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Making predictions within the scope of complex systems is very difficult. It is difficult to the point of being absurd. It seems the most that can reasonably be done are to state your premises and conclusion.

an over simplistic example:

1. Improved US economic activity
2. The Fed will slow down QE
3. The USD can be seen as a commodity and it is cheap.

therefore I think the dollar will strengthen.
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herewardwake
Dec 27, 2020 3:57pm
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Quoting FXMasterZero
{quote} The way analysts speak about the market, and how specific things have a certain effect, it would make you think they'd be managing hedge funds and not writing articles lol
On most days when I read an article written by a financial journalist, I get a bit of righteous indignation. Then I realize that the journalist has to meet many deadlines and write many articles every day. Then I get even more righteous indignation because if they are writing so many damn articles those articles can't be well-researched, they can't be well-edited and their only purpose is to get the viewer to click the link. It is a crappy business model.
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rafat habeb
Dec 27, 2020 1:51pm
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Quoting herewardwake
Making predictions within the scope of complex systems is very difficult. It is difficult to the point of being absurd. It seems the most that can reasonably be done are to state your premises and conclusion. an over simplistic example: 1. Improved US economic activity 2. The Fed will slow down QE 3. The USD can be seen as a commodity and it is cheap. therefore I think the dollar will strengthen.
totally agree with you mate
Reply
FXMasterZero
Dec 27, 2020 2:21pm
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Quoting herewardwake
Making predictions within the scope of complex systems is very difficult. It is difficult to the point of being absurd. It seems the most that can reasonably be done are to state your premises and conclusion. an over simplistic example: 1. Improved US economic activity 2. The Fed will slow down QE 3. The USD can be seen as a commodity and it is cheap. therefore I think the dollar will strengthen.
The way analysts speak about the market, and how specific things have a certain effect, it would make you think they'd be managing hedge funds and not writing articles lol
Reply
clockwork71
Dec 27, 2020 7:22pm
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Quoting herewardwake
{quote} On most days when I read an article written by a financial journalist, I get a bit of righteous indignation. Then I realize that the journalist has to meet many deadlines and write many articles every day. Then I get even more righteous indignation because if they are writing so many damn articles those articles can't be well-researched, they can't be well-edited and their only purpose is to get the viewer to click the link. It is a crappy business model.
You just described ALL NEWS.
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foto
Dec 27, 2020 7:38pm
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As UK exits EU one less pocket to pick to keep the charade going for Euro. Covid Bill supposedly getting signed by Trump means another shot of stimulus for US economy which continues to outperform Europe.

On another note China is out purchasing massive quantities of food around the Globe as all that flooding destroyed their crops in 2020. Food shortages coming in China will affect markets in 2021.
Depends how Bad it gets but CCP is headed for Big Problems as Global food stocks are not growing to keep pace. Brazil in drought and CCP is now buying US Soy Beans and Pork product to cover shortfalls.
Also buying Rice from Asia.

For those who think Food security is not going to be an issue in years to come ask yourself why UK fisheries was such a Big deal in Brexit negotiations.
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syedsaadnaee
Dec 27, 2020 8:02am
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Eurusd will be below 1.20000 before feb 2021
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Fanatikos
Dec 27, 2020 11:34am
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syedsaadnaee" Wrong forecast, EUR goes forward together with GBP, AUD, NZD against USD.
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