USD will remain under downward pressure in the short term – BBH

The US Dollar (USD) is trading on the defensive, underperforming the JPY. The US yield curve has inverted slightly and US equity futures are on the upside, BBH FX analysts note.

The US yield curve is slightly inverted

“USD is trading on the back foot, underperforming JPY. The US yield curve has inverted slightly and US equity futures are higher.”

“The USD is likely to remain under downward pressure in the near term against the major currencies as Fed Funds rate expectations continue to diverge from the FOMC dot plot.”

“Fed funds futures are pricing in over 60 bps of cuts by December 2024, while the FOMC has only forecast a 25 bps cut this year.”

Source: Fx Street

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