The US Dollar (USD) is tracking a little lower overall on the session. Economists at Scotiabank analyze Greenback’s outlook.
USD gains overstate spread shift
The USD will need the support strong economic data and/or higher yields to continue advancing.
Short-term spreads have moved in the USD’s favour since mid-January but there are signs that USD gains are overstating the improvement in fundamentals.
Other factors, such as position adjustment, may be helping lift the USD tone – which suggests scope for additional USD is limited unless fresh USD-positive impulses develop
Source: https://www.fxstreet.com/news/us-dollar-may-struggle-to-extend-gains-without-new-impulse-scotiabank-202402071401