Mitsubishi UFJ analyst Lee Hardman said the dollar may struggle to strengthen
unless the Federal Reserve, at its upcoming decision, cements market
expectations that the tightening cycle will persist longer. LSEG data show
markets have almost fully priced a 25bp hike on Wednesday and about 95bp of
cumulative hikes by Sep 2027. Hardman said that pricing raises the bar for the
Fed to send a more hawkish signal and that Fed communication is unlikely to
clearly indicate how much further tightening will be needed.
