Disliked{quote} Dollar has been weak off the back of geopolitical events and trump. Nothing about this hike has been priced in. You could even look at it as though the previous hike has been rolled back. There is a deviation of price and the underlying fundamentals. How long this holds out is anyone's guess. The $ is cheap at current prices though on a medium term outlook {image}Ignored
(kids were playing up so did not give this my full attention!)
http://www.cnbc.com/2017/05/24/fed-s...ts-remain.html
"Economists maintain expectations for a June rate hike". Perhaps the terms fully priced in is too strong,
The dollar sold off following FOMC minutes, believe that this was a case of sell the news - it had been bullish going into the event as traders were looking for further clues on potential rates (which I feel may somewhat have been quashed)
Also looking through recent Fed members speeches Bainard's views which are known to most closely resembles Yellen's, had said that the global outlook was the brightest for years, although had wondered whether the US is at full employment.
My main thought is that there has been a drop on PCE for 3 consecutive months following the Fed hike
Also CPI is following a similar downward trajectory path.
Although average hourly earnings however are improving.
As I feel that Yellen is a dove at heart, she could well push back a rate hike and wait for inflation to reverse its current direction.
A further hike could well maintain the current direction of the PCE/CPI.
One thing to note is that the Fed members before the latest hike had forewarned us about a potential hike in rates.
This appears not to be the case at the moment.
Overall I think that the Fed will push the rate hike back (notwithstanding any strong NFP & CPI figures)
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