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ING analysts said their bearish 2021 dollar view rests on the Fed keeping policy loose and on a synchronised global recovery, and both premises are now being questioned. They argued it is too early for wholesale changes to their dollar forecasts.
The note discusses reflation trades including higher commodities and a weaker dollar.
If the dollar strengthens rather than weakens, commodity prices denominated in dollars face less support, although ING still expects a weaker dollar over the year.
think.ing.comChris TurnerJan 28, 2021After 359 past neutral macro events, US Dollar (Broad) moved a median -0.0% over 5 sessions (49% higher; middle half -0.4% to +0.4%), and -0.1% over 20.
After 129 past neutral macro events, Euro (USD per EUR) moved a median -0.1% over 5 sessions (45% higher; middle half -0.5% to +0.5%), and +0.1% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
