Weekly FX Chartbook: Dollar rally looking stretched, bullish signals for NZD
Charu Chanana
Market Strategist
Summary: With hawkish vibes since the start of the year from Fed pushback and jobs/inflation data surprises, the gap between market expectations for Fed’s 2024 rate cuts and the December dot plot has nearly closed. Dollar positioning has also turned to a net long, suggesting the bar for further gains may be high. China markets have returned with optimism after the Lunar New Year holiday, but the sustainability of the trend will be one to watch and that can support CNH and AUD, while NZD looks more compelling amid room for RBNZ rate cut delay and a technical buy signal.
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