The dollar continues to struggle after the FOMC minutes. This move is seen as corrective but economists at BBH note that the US Dollar Index could slide below the 100 level on failure to hold 101.80.

Dollar soft in the wake of FOMC Minutes

“DXY is trading near 101.90 on the markets’ dovish take on the minutes. Key level to watch is 101.80 as a clean break below would set up a test of the April 21 low near 99.818.” 

“We still view this recent move lower as a correction within the longer-term dollar rally but we continue to be surprised at how far the dollar has fallen from the early May peak.”

“We continue to believe that pessimism regarding the US is overdone, with markets overlooking the problematic fundamental outlooks for the eurozone, UK, and Japan.”