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USD: Dollar enthusiasm may have peaked (Bloomberg’s MLIV survey)

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The Bloomberg’s MLIV Pulse survey results from October 23-27th  (528 respondents including me)

  • October MLIV Pulse saw dollar enthusiasm eased from the 60% peak to 59%.
  • The Nasdaq 100 will decline by as much as 10% this quarter, according to 45%
  • 85% believe the so-called real neutral rate – which strips out the effect of inflation- has risen to around 100 basis points or higher, from estimate of about 50bps
  • 10-year Treasury rose 4.3 bps to 4.879%

 

At the beginning of the month, plenty of top investment banks were making aggressive dollar bullish calls.  It seem everyone was either picking 1.02 or parity for the EUR/USD currency pair.  The euro has shown some resilience and that his leading to some cautiousness with king dollar calls.  The dollar trade got a bit crowded but if this week’s fireworks send yields skyrocketing, the dollar should reign supreme.  If the Fed’s higher for longer ends up pricing in another quarter or half point in hikes, that could be enough to send the euro to parity.

EUR/USD Daily Chart

 

 

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Ed Moya

Ed Moya

Contributing Author at OANDA
With more than 20 years’ trading experience, Ed Moya was a Senior Market Analyst with OANDA for the Americas from November 2018 to November 2023. His particular expertise lies across a wide range of asset classes including FX, commodities, fixed income, stocks and cryptocurrencies. Over the course of his career, Ed has worked with some of the leading forex brokerages, research teams and news departments on Wall Street including Global Forex Trading, FX Solutions and Trading Advantage. Prior to OANDA he worked with TradeTheNews.com, where he provided market analysis on economic data and corporate news. Based in New York, Ed is a regular guest on several major financial television networks including CNBC, Bloomberg TV, Yahoo! Finance Live, Fox Business, cheddar news, and CoinDesk TV. His views are trusted by the world’s most respected global newswires including Reuters, Bloomberg and the Associated Press, and he is regularly quoted in leading publications such as MSN, MarketWatch, Forbes, Seeking Alpha, The New York Times and The Wall Street Journal. Ed holds a BA in Economics from Rutgers University.
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