The Dollar remains broadly bid. It is hard to argue with Dollar strength near term, in the opinion of economists at ING.

Dollar to hold gains

“The Fed's current median expectation sees Fed Funds at 5.00-5.25% by the end of 2023 and 4.00-4.25% by end-24. Both of these projections could be revised higher. This prospect could well dissuade investors from re-entering Dollar short positions over the next few weeks.”

“The US 2-10 year yield curve is now inverted the most since the Paul Volcker tightening of the mid-1980s – creating a headwind to risk assets. It is hard to see global equity markets pushing much further ahead until there are clearer signs that the Fed – and other central banks – can relent in their tightening cycles.

“DXY broke above 105.00 on Friday and the multi-week bias looks towards resistance at the 106.20/106.50 area – some 1.00/1.20% above current levels. Through March we will better assess whether these prove the best dollar levels of the year.”