“Data showing a robust labor market stand to bolster the dollar as traders ramp up bets the Fed will lift its benchmark rate this year. Yet the opposite result, where expectations for a 2015 increase fade, may not derail the greenback, Credit Suisse analysts said in a note Wednesday. That’s because signs the world’s biggest economy is cooling may help spur the European Central Bank and the Bank of Japan to keep adding monetary stimulus, undermining the euro and yen,” reports Liz McCormick for Bloomberg.
Still, the Fed boosting interest rates is seen as perhaps the most important catalyst for additional near-term greenback upside.
“Traders see a 43 percent probability of a move by the Fed’s Dec. 15-16 meeting, according to futures data compiled by Bloomberg. The chances are 51 percent by the January meeting and 64 percent by the March gathering, based on the assumption that the effective fed funds rate will average 0.375 percent after liftoff,” according to Bloomberg.
PowerShares DB U.S. Dollar Index Bullish Fund
