Hope is high amongst traders that the low volatility environment that has forced many to change to a short-term approach or stay sidelined for near-perfect setups will end soon. Volatility is a critical ingredient to the dollar’s performance moving forward.
More modest erosion in the EUR-complex although EURUSD continues to surprise, as the US Dollar’s own issues are preventing it from finding a veritable launching point.
The GBP/USD held within the previous week’s range as the Bank of England (BoE) laid out new measures to stem the risk for an asset-bubble, but the bullish sentiment surrounding the British Pound may gather pace throughout the second-half of the year as the central bank shows a greater willingness to start normalizing monetary policy sooner rather than later.
Domestic policy returns to focus for the Australian Dollar in the week ahead as all eyes turn to the RBA interest rate decision. Economists’ expectations suggest Governor Glenn Stevens and company will leave the baseline lending rate unchanged yet again.
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