US Dollar Extends Gains after Strong Business Investment Data but Strategists are Now Scoping Out a USD Reversal

The US Dollar rose broadly in the final session of the week as traders' appetite for risk faltered across the globe and markets responded to the latest volley of US economic data, which showed many categories of American business investment recovering strongly from a March slowdown.

The US Dollar ascendency seen so far in the second-quarter has gone about as far as it is likely to, according to strategists at TD Securities, who argue it now makes sense for traders to bet on a decline in the Dollar index over coming weeks. 

The US Dollar weakened broadly Thursday while so called safe-haven assets rose broadly after the White House said it has cancelled a landmark summit between President Trump and North Korean leader Kim Jong-Un, citing "tremendous anger and open hostility" displayed by the regime in some of its most recent statements. 

 The Dollar's recent rally could have been, in a large part, as a result of seasonal factors to do with the timing of the Congressional budget.

The US Dollar fell during overnight trading and into the London session Thursday as traders responded to the minutes of the latest Federal Reserve monetary policy meeting, which were interpreted by the market as being on the "dovish" side of expectations and so, bad for the greenback. 

Emerging market FX is still looking too risky because of ongoing crises in Turkey and Argentina.

The US Dollar rally has further to run although, according to currency strategists at Morgan Stanley, it is still little more than a corrective bounce within a longer term, bearish downtrend.

The US Dollar posted a mixed performance against the developed world currency basket Tuesday as the greenback's month-long rally appeared to grow long in the tooth, leaving strategists and economists divided in their outlook for the currency.