HSBC: The key to the dollar lies in US trade policy, not monetary policy

Odaily News HSBC Global Research economists said the key to the dollar's direction may depend more on the evolution of U.S. trade policy than monetary policy. "For the dollar, the FOMC stance in March was neutral enough and did not challenge the general bearish sentiment on the dollar, especially as U.S. Treasury yields fell," they said in a report. But they said it was not enough to prompt a sustained sell-off in the dollar. They said that after a strong start to the year for U.S. Treasuries, the Federal Reserve continued to take a wait-and-see approach, so there was reason to be more cautious about short-term yields and maintain its forecast for the 10-year Treasury yield at the end of 2025, which is 3.50%. These economists believe that there is potential for further clearing of the U.S. stock market as some of the bank's indicators show oversold levels. (Jinshi)