Dollar-supportive factors may fade soon, says Wells Fargo
Longer-term dollar weakness likely as Fed approaches neutral policy, but how soon will that be?
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Growth and interest rate trends that are currently working in the dollar’s favour could run out of steam in the medium term as expectations build for a slowdown in the US economy, and as the Federal Reserve slows its policy normalisation, says Erik Nelson, a currency strategist at Wells Fargo.
For now, the greenback’s momentum looks intact, as positive economic data points and inflation near the 2% mark mean the
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