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US dollar recovery may be short lived
US Treasury yields slightly rebounded as the Federal Reserve's Jerome Powell and James Bullard failed to match the market’s aggressively dovish expectations, prompting the dollar to recover from recent lows. While Powell’s remarks kept a more accommodative easing on the table, Bullard – arguably the most dovish member of the FOMC – downplayed the possibility of a 50 basis point cut in July. Data-wise, today’s release of preliminary Durable Goods Orders for the month of May could put a cap on the US dollar recovery, as our economists expect a contraction in the month-on-month reading. All in all, we expect ... (full story)