{"id":35552,"date":"2023-07-14T07:17:42","date_gmt":"2023-07-14T11:17:42","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/deutsche-bank-currency-guru-says-its-time-to-sell-the-dollar-as-greenback-sees-longest-losing-streak-since-2021\/"},"modified":"2023-07-14T07:17:44","modified_gmt":"2023-07-14T11:17:44","slug":"deutsche-bank-currency-guru-says-its-time-to-sell-the-dollar-as-greenback-sees-longest-losing-streak-since-2021","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=35552","title":{"rendered":"Deutsche Bank currency guru says it\u2019s \u2018time to sell the dollar\u2019 as greenback sees longest losing streak since 2021"},"content":{"rendered":"
\n

A top Deutsche Bank currency analyst has declared that it\u2019s time to sell the U.S. dollar.<\/p>\n

George Saravelos, global co-head of FX research at Deutsche Bank, said in a note to clients shared with MarketWatch on Thursday that he\u2019s once again betting that the dollar will weaken against the euro
\n EURUSD,
\n +0.01%<\/bg-quote>,<\/span>
\n as well as the Japanese yen
\n USDJPY,
\n +0.26%<\/bg-quote>,<\/span>
\n British pound
\n GBPUSD,
\n -0.16%<\/bg-quote>
\n and other major currencies.<\/p>\n

\n

See: U.S. dollar on pace for sixth consecutive day of decline as inflation cools<\/p>\n

See:<\/strong> U.S. Dollar Index chart breakdown warns that further losses loom<\/p>\n

Updated forecasts included in the note have the dollar weakening through 2024, with further weakness, or stagnation, seen in 2025. <\/p>\n

Saravelos maintained a bullish call for the euro for most of 2023, but went \u201ctactically\u201d bullish on the greenback in May. <\/p>\n

But Wednesday\u2019s CPI report, showing U.S. inflation showing to the lowest level since 2021, was the evidence he was waiting for to suggest that the U.S. dollar is likely headed lower, as the Federal Reserve likely won\u2019t need to hike interest rates quite as high, or keep them elevated for longer. <\/p>\n

\u201cWe have had a bullish bias on EUR\/USD throughout this year but tactically\u00a0took profit\u00a0in early May awaiting for more confirmation that dollar drivers are turning bearish. [Wednesday\u2019s] US inflation print is the last piece of evidence we have been waiting for to recommend going long EUR\/USD again,\u201d Saravelos said. <\/p>\n

While his forecast has the euro rising to $1.15 by the end of the year, an advance to $1.20 is \u201centirely possible.\u201d The shared currency was trading at $1.1228 on Thursday. <\/p>\n

According to Saravelos, the dollar is suffering from a double-whammy of sustainable disinflation and strong \u2014 but not too strong \u2014 economic growth. <\/p>\n

\u201cFirst, we feel increasingly confident that the US disinflation process is well under way,\u201d he said in the note. <\/p>\n

\u201cSecond, the disinflation process looks increasingly benign. We have been arguing that the most bearish outcome for the dollar is a combination of declining US inflation under relatively OK growth conditions,\u201d he said. <\/p>\n

The dollar rallied in 2022 as the Fed\u2019s aggressive interest-rate hikes, including four consecutive jumbo hikes of 75 basis points, widened the differential between the yield investors could reap from holding dollars vs. other currencies, tilting it heavily in the dollar\u2019s favor. <\/p>\n

What\u2019s more, fears of a recession, stoked by both aggressive Fed monetary policy and two consecutive quarters of negative economic growth in 2022, caused a rush for safety by international investors into the greenback. <\/p>\n

The ICE U.S. Dollar Index
\n DXY,
\n +0.10%<\/bg-quote>
\n rose 7.9% in 2022, its best yearly advance since 2015, according to FactSet data. <\/p>\n

At its peak, the dollar index traded just below 115 in late September 2022, its highest level in more than 20 years but has been sliding ever since. <\/p>\n

The dollar index was at 99.8 on Thursday after falling 0.8%, its sixth consecutive day in the red. It marked the currency\u2019s longest losing streak since September 2021, according to Dow Jones Market Data. It\u2019s also the indexes lowest level since April 2022. The index has fallen 3.6% so far this year. <\/p>\n

Just as the dollar\u2019s September high last year nearly coincided with the stock market\u2019s lows, the greenback\u2019s latest nadir has coincided with a fresh 15-month high for U.S. stocks.<\/p>\n

The S&P 500
\n SPX,
\n +0.85%<\/bg-quote>
\n traded above 4,500 on Thursday for the first time since early April 2022, FactSet data show, as the stock-market index powered higher, bolstered by hopes for an end to Fed interest rises this year. <\/p>\n<\/p><\/div>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

A top Deutsche Bank currency analyst has declared that it\u2019s time to sell the U.S. dollar. George Saravelos, global co-head of FX research at Deutsche Bank, said in a note to clients shared with MarketWatch on Thursday that he\u2019s once again betting that the dollar will weaken against the euro EURUSD, +0.01%, as well as […]<\/p>\n","protected":false},"author":1,"featured_media":35553,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"gallery","meta":{"footnotes":""},"categories":[241],"tags":[83],"class_list":["post-35552","post","type-post","status-publish","format-gallery","has-post-thumbnail","hentry","category-markets","tag-featured","post_format-post-format-gallery"],"yoast_head":"\nDeutsche Bank currency guru says it\u2019s \u2018time to sell the dollar\u2019 as greenback sees longest losing streak since 2021 | iFintechWorld<\/title>\n<meta name=\"description\" content=\"A top Deutsche Bank currency analyst has declared that it\u2019s time to sell the U.S. dollar. 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