US GDP in line with expectations – Commerzbank
|In contrast to the ADP figure, the publication of the US GDP data (for Q3) did not come as any major surprise. The figure (+2.8% annualized) was close to the median of analyst estimates (2.9%), so it was not a big surprise, Commerzbank’s Head of FX and Commodity Research Ulrich Leuchtmann notes.
Further US growth impulses are needed for new USD strength
“Of course, with growth rates like these, the US continues to have a significant growth advantage over other major developed economies, which are virtually stagnating after the immediate post-corona recovery has ended: the eurozone, the UK, and Japan. And that justifies USD strength. But we have to be careful. This growth advantage is not new. After all, the dollar is already strong. See figure below. US growth strength is already priced into Fed expectations, asset prices and USD exchange rates, it seems to me.”
“Further US growth impulses would be needed for new USD strength. One or the other currency trader may expect a second Trump presidency to provide such impulses. That may well be. I would just like to remind you that other conditions are also needed for this. Among other things, a Fed monetary policy that continues to be guided by reason.”
“Be that as it may, I think it's plausible that some market participants want to wait until the election and do not want to enter active positions based on current real economic data.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.