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Breaking News: Four Reasons For A Dollar Selloff Even As Fed's Hiking Isn't Over

[fa icon="calendar'] December 15, 2017 at 3:43 PM / by Fullerton Markets posted in Breaking News

The Federal Reserve raised interest rates by 25bp and instead of rising, the dollar sold off aggressively against all of the major currencies. The short-term interest rates or also known as "short end" of a yield curve went higher as expected. However, long term yields went down due to slower inflation expectations. A flattening yield curves is hurt the US Dollar which was seen by the sell-off.

Janet Yellen gave her final press conference as Fed Chair and said Trump tax reform has limited impact to growth and inflation in the long term.

Furthermore, the gains in dollar for the past few months was largely driven by tax cut. Thus, traders now were selling off their dollar long exposure.

Lastly, the ECB meeting yesterday also hurt the Dollar as a dovish ECB was not really priced into the market. While Draghi's message was more hawkish than the market anticipated, the main takeaway is that even though the economy is improving, they have no plans to raise interest rates anytime soon. A gradual hike by ECB seems likely in 2018, which indicates less hopeful sentiments for the dollar to rally.

With US Treasuries curve flattening after Fed raised the rate, short USD/JPY?


US Jobs Report clears doubt of Fed’s Rate Hike This Week

[fa icon="calendar'] December 11, 2017 at 2:30 PM / by Fullerton Markets posted in Weekly Market Research, 2017

Traders may take profit on dollar-long positions after Fed’s hike this week, buy EUR/USD? 


Sneak Peek: How the FX Market might react to US Jobs report tonight

[fa icon="calendar'] December 8, 2017 at 4:00 PM / by Fullerton Markets posted in Sneak Peek

If US jobs report were to beat estimates, short GBP/USD?


US Tax Reform to spur more Hawkish Fed Policy Next Year

[fa icon="calendar'] December 4, 2017 at 2:04 PM / by Fullerton Markets posted in Weekly Market Research, 2017

If Fed were to raise rates three times or more in 2018, is USD/JPY long a “Star Call”? 


Sneak Peek: Euro Zone’s Inflation Likely To Accelerate

[fa icon="calendar'] November 30, 2017 at 12:35 PM / by Fullerton Markets posted in Sneak Peek

If euro zone CPI accelerates this month, long EUR/CAD?