Curious About The Dollar’s Next Move?

Data regarding jobs is always important. The jobs report for March that will be published this week could even be crucial for the road the dollar will take in the coming months. The recent weakness in the dollar is directly linked to the expectation of the market that the Federal Reserve will keep interest rates low for another while and that a rate hike in September is much more likely than June.

Future Of The Dollar

The jobs report is very important, potentially even so important that strong figures would keep the option of a June rate hike on the table. If we get a figure of 250,000 it is still possible according to Alan Ruskin, head of G-10 currency foreign exchange strategy at Deutsche Bank. If less than 250,000 jobs were created in March, the idea of a rate hike later in the year seems more likely.

Until last week, the dollar was on a tear; it was listed at 10 percent for the year on the back of a strong economy, but also thanks to the idea of higher interest rates while other central banks are still in a phase of expansive monetary policies.

According to Boris Schlossberg from BK Asset Management the figure will be important as well. It is unclear what the Federal Reserve is going to do exactly. The jobs report will probably have a strong impact on the decision making process of the Fed, in his opinion. If the figure is very good, there is no more reason to keep interest rates low.