Danske Bank: The weakness of the dollar will not be reversed for the time being

Jesper Fjaerstedt, senior analyst of foreign exchange strategy at Danske Bank, pointed out in a note that the inversion of the U.S. Treasury yield curve and the weakening of the dollar may be a bit excessive in the short term, although the data released this week is unlikely to prompt a reversal of this trend. Fjaerstedt said the market is likely to look for confirmation of a downward trend in inflation to justify an inverted money market curve and a weaker dollar. U.S. Treasury supply has been hitting the market since the end of January, potentially triggering a front-end Intrerest Rate and EUR/USD USD reversal.