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Trader, analyst and instructor with a 6-year experience

USD: forecast for December 7-13

By Kira Iukhtenko

USD index holds below the key mark of 100 points despite the fact that the Fed’s rate hike on December 16 is almost a done deal. According to the futures market, the chance of a hike is now close to 80%. Strong NFP released on Friday heightens these expectations. However, the rate move is already priced in by the market, so potential for further USD strength is now seen as limited.

USD index fell by more than 2% on Thursday as the market expected the ECB to deliver more stimulus than just a small deposit rate hike. Such a strong move shows the greenback is broadly overbought. The market now switches to the future rate path: how steep are the hikes are going to be?

Economic calendar on the new week is much calmer. On Thursday, we will watch the US jobless claims, while on Friday don’t miss the retail sales data and the November PPI.Economic calendar on the new week is much calmer. On Thursday, we will watch the US jobless claims, while on Friday don’t miss the retail sales data and the November PPI.

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