When will it be safe to buy the dollar?

The FOMC meets in nine days with a decision coming July 31. One of the reasons expectations are so low for any sort of policy change then is because we get so little economic data in the interim. This Friday we get durable goods and next Wednesday, just hours before the decision, we get the first (and always revised) reading on Q2 GDP.

I suspect tapering is largely priced in at this point, with the market expecting some modest drawdown in monthly stimulus to be announced at the Sept 18 meeting.

That said, I think the market is scared to buy the dollar, at least until the headlines hit and USD kneejerks lower. It could be a classic sell the rumor (sell USD on the tapering rumor) and buy the fact.

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