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Dollar seen consolidating after May rally, set for ISM and ADP

BBH expects the DXY to trade in a 96.0 to 100.0 range as markets watch services inflation pressures in the ISM Prices Paid index and private payrolls from ADP.

Reported · Written up by our desk · Major Pairs

Brown Brothers Harriman analyst Elias Haddad said the US dollar outlook has shifted to consolidation after the rally that began in May, with the Dollar Index (DXY) expected to stay rangebound between 96.0 and 100.0.

FXStreet reports that the dollar’s recent strength is being weighed by rising global equities and stabilizing oil prices, while the Fed’s ability to translate tough inflation language into credible policy has not provided as much support for the currency.

The focus ahead of the next set of US data is on ISM Services Prices Paid and ADP private payrolls, with Fed pricing viewed as more sensitive to inflation than employment outcomes.

Consensus expects ADP private payrolls to add 65,000 jobs versus 98,000 in June, while the ISM Services headline index is expected to improve to 54.5 from 54.0, and the Prices Paid index is projected to ease to 65.0 from 67.7, which would mark a five month low.

Latest closeDollar index 99.88 ▼0.1%

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