FX markets remained volatile throughout August, with the DXY’s range increasing from 1.43% in July to 2.12%. Heightened concerns around new waves of Covid-19 and uncertainty about the Fed’s taper timeline kept market participants busy, however, the macroeconomic backdrop is seemingly becoming more supportive as we head into September. Given this, we continue to envisage mild US dollar weakness across the G10 but expect volatility to remain abundant as liquidity conditions improve. In September alone, markets will have to contend with elections in both Canada and Germany, a rate hike from Norway, and pivotal central bank meetings in the US and Europe.
You can read more about our latest views and forecasts below:
Simon Harvey, Senior FX Market Analyst
Olivia Alvarez Mendez, FX Market Analysis
Ima Sammani, FX Market Analyst
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