US: Forces required to make the USD great again are quickly falling - ING

The forces required to make the US dollar great again are quickly falling by the wayside, according to analysts at ING.

Key Quotes

“Of late, it has been a Fed story – with the negative economic effects of Hurricane Harvey (and now Irma), North Korea tensions and lacklustre US inflation dynamics seeing odds of another Fed hike this year tumble to 28%. We may need to see an all-mighty turnaround in US data to convince the Fed to raise rates in December; this makes the August CPI data (Thu) this week very important. Our economists expect headline CPI to pick-up to 1.9% YoY, while base effects could weigh on core inflation (1.6% YoY vs. 1.7% prior). A negative CPI surprise, however, would deliver the final nail in the coffin for a Dec rate hike. US retail sales (Fri) should point to stronger consumer activity, which could support USD sentiment towards the end of the week.”