The U.S. dollar is trading below the level implied by market expectations for U.S. interest rates, HSBC analysts said in a report.
According to Jin10, the analysts said the dollar has reacted only modestly even as recent market pricing has shifted from expecting rate cuts to the possibility of rate hikes.
They said the limited response may reflect loose U.S. financial conditions and market hopes that the conflict in the Middle East will be resolved.
HSBC added that the dollar needs a clearer catalyst from monetary policy. The analysts said that if the Federal Reserve does not support expectations for rate hikes at next week’s meeting, the dollar may come under pressure.
Dollar Lags Rate Expectations as HSBC Says Fed Signals Are Needed
2026-06-12 11:50:07
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