• US dollar is the strongest currency in G10 just before the US session
  • FED’s Dudley delivers quite upbeat and hawkish remarks
  • Chicago FED national activity index comes in below estimations

The dust after the election weekend seems to be settling and the US dollar is the largest beneficiary of that scenario. The greenback is by far the best performing currency in the G10 basket as the index (USDIDX on xStation5) is already up 0.45% while the euro and NZD are among the worst ones.

The US session does not abound with crucial macroeconomic releases, hence it’s worth paying attention to some FED speakers’ comments. The first remarks from Dudley have already come out. He underlined the Federal Reserve will keep gradually removing monetary policy accommodation which is rather a hawkish one given he has been viewed as one of the major dove within the FOMC. He also added inflation should rise and stabilize around the 2% target, once ’temporary and idiosyncratic’ factors fade. Dudley said that slightly above-trend of US growth ought to support wage gains.

link do file download linkChicago FED national activity index falls short of estimation in August suggesting weaker results seen in Chicago PMI. Source: Bloomberg

Otherwise, we got a reading of Chicago FED national activity index which came in at -0.31 while -0.25 was expected. On the other hand, the prior release was marginally revised up from -0.01 to +0.03. As you can see above, this indicator could suggest weaker performance measured by the more important Chicago PMI.

link do file download linkMeanwhile, the USDCHF is pushing higher and is getting closer to 0.9760. If buyers are sufficiently determined to break it, it could provide further upside towards 0.9820. Source: xStation5