It may be too soon to tell whether the dollar index breaking below its 200-day moving average will open the door for a long-term decline in the dollar. But, from a long-term perspective, it fits with the narrative that the USD is close to peaking. Indeed, we could even argue that the USD has been close to peaking for several years now, or at least since H2 2015 (see first chart). Since then, the broad dollar has essentially moved sideways despite the Fed being the only major central bank tightening, the bad news coming out of Europe, and the continued uncertainty over China’s growth outlook…
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