Sentiment surrounding USD has recently been going from strength to strength, with the interbank rate at the best levels since the start of the year against GBP.

Currency Pair% Change (Month)Difference on £200,000

The US dollar Index (DXY), which is the indicator of the currency's performance against a basket of its major counterparts, is currently showing that the Greenback is experiencing its best performance since May 2017. Suggestions of a economic slowdown for the US economy appear to have diminisheda and it’s difficult to see the currency losing ground in the short term.

This being said, there are growing concerns amongst analysts that it’s only a matter of time before the global trade tensions that have been largely fuelled by the US President, might begin to have an impact on the economy and the currency, as the prolonged uncertainty ultimately benefits no one.

The USD has seemingly benefitted from its safe-haven status, as investors seek stability in times of market uncertainty, however the retaliatory tariff hikes between the US and China is beginning to negatively impact consumers and manufacturers as the price of imports is rising.

Wells Fargo Releases Upgraded US Dollar Forecast

Economic data to affect USD gains?

There is a raft of US economic data set to be released this week, in addition to statements from key members of the Federal Reserve which could influence USD market movement.

Jobless data set to be released on Thursday is expected to show improvement from the previous and the Markit industry data is indicating signs of expansion. Despite this, the Nondefense Capital Goods Orders scheduled for Friday, which is a key measure of manufacturing performance, is expected to see a drop of 0.9% from the previous which could see the Greenback weaken and provide an opportunity for USD buyers.


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