National Bank of Canada analysts see near-term USD support but doubt imminent Fed tightening after weaker June jobs data.
The US Dollar remains near its 2026 peak, bolstered by persistent US inflation and widening interest rate differentials. Analysts note the currency’s strength against major peers over the past month, driven by repriced rate expectations.
June nonfarm payrolls rose by just 57K, missing forecasts, while prior months were revised down by 74K. The household survey showed a 507K employment decline, raising questions about the Fed’s next move despite the dollar’s resilience.
Speculative positioning in the USD appears stretched, and while near-term support is expected, the rally may face headwinds beyond Q3. Analysts forecast a gradual decline in the broad USD index to 115.9 by Q2 2027.