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Dollar resumes bullish trend

By Callum Holmes March 7th, 2017

The US dollar continued to strengthen against both sterling and the single currency yesterday. The Greenback had given up some of its gains on Friday due to end-of-week profit taking.

Markets are now pricing in an 80% chance of an upcoming interest rate hike in the US. Economic data has been positive and held its ground despite the uncertainty surrounding the new political direction.

A figure that will be closely watched this week will be non-farm payrolls on Friday. If this turns out to be positive, it will be hard to think there could be anything in the way of a further interest rate hike next week.

Meanwhile, US factory orders rose for a second consecutive month in a row, suggesting that the recovery of the manufacturing sector was gaining momentum.

Looking to the day ahead, the key data release from the US is the trade balance.