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Rising U.S. interest rates and safe haven flows have seen the U.S. dollar soar in 2022. The American 10-yr yield rose six basis points to 3.12%, hitti
[See the full post at: Forex Weekly Outlook – Japanese Yen Weakest Major Currency Against US Dollar in 2022]USD moves lower as yields back off versus all the major currencies with the exception of the CHF.
The GBP got a boost to new highs helped by comments from BOE Bailey that inflation is the central banks biggest challenge, and rising food price were also a major worry. The BOE warned that inflation may rise to 10% later this year.
The price has now moved above a swing area between 1.2288 and 1.23006.
Spot gold move higher with the falling dollar. The price of gold rose will dollars and $0.62 or 0.70% $1823.30
Goldman sachs says a recession would cast doubt on a strong US dollar Via Bloomberg
Note from Goldman Sachs strategists including Zach Pandl, co-head of global FX and EM strategy
cites historical data showing a more mixed performance for the greenback during an economic contraction
While the US dollar typically strengthens when a recession is looming, all bets are off once it hits
Right now, the US dollar is currently “highly overvalued” by around 18%
Goldman sees two possible outcomes for the currency in coming weeks:if the global growth outlook improves, it will weaken as investors veer to riskier assets;
if the world economy does enter a recession, the dollar’s path is murky.In the former case, the dollar should be shorted against most currencies, with the bank particularly favoring commodity exporters like the Canadian dollar.
In the latter, the Japanese yen will likely outperform the dollar as it usually does well during recessions.
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