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USD Index Extends Weakness, Eyes 2023 Lows

EMERGING MARKETS
  • The greenback remains soft against most others in G10, putting the USD Index to another monthly low and within range of the early February support at 100.82. Weakness through here would put the USD at the lowest level since late April last year, a move predicated by the waning expectations for the Fed peak rate as well as the softer details in the March US CPI release.
  • USD weakness has helped tip most major pairs towards a number of key levels - EUR/USD now sits comfortably north of 1.10, while GBP/USD has made a new marginal trend high above the bull trigger at 1.2525. A sustained break would mark the resumption of the uptrend off the March low and end the 2023 consolidation phase on a positive note.
  • US weekly jobless claims data and the March PPI release take focus going forward, while the central bank speaker slate circles an MNI event with BoE Chief Economist Pill at 1400BST/0900ET and ECB's Nagel after the London close.

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