U.S. Dollar

Come on UNITED STATES we need the dollar to be doing better...According to this article it was the worst performing G10 currency. The most powerful nation and the worst performing currency?! How can this be... Well, read and find out what is going on with our dollars...

We’re coming more and more around to the conclusion that the U.S. dollar rally in December was primarily fuelled by short covering. Certainly, there was some element of interest rate expectations as the market started to price in Fed rate hikes but that was a much smaller factor. In December, there was some speculation that good U.S. data was on the cusp of creating a paradigm of U.S. dollar strength. Today we saw the ISM manufacturing index rise to 55.9 in December, above the 54.3 consensus and 53.6 prior yet the USD was the worst-performing G10 currency. Friday’s payrolls report will be a real test, in the meantime, we will be keeping a close eye on how the USD reacts to good U.S. news.