Where Petk UBS expects the US dollar to have good support in the coming months, pointing to relatively resilient US economic data, but is worried it will weaken slightly as 2024 progresses. And UBS says that would be a response to a significant slowdown in U.S. economic data and Fed policy.
The bank said it expects economic growth to slow sharply in the next few quarters, with a moderate contraction of half a percentage point in mid-year
It expects GDP to grow by just 0.3% in 2024, also raising the unemployment rate to 5.0% at the end of 2024
The Fed will also move Fed funds to a slightly lower level in March
Interest rate cuts will accelerate in the second half as he predicts the Fed will cut rates by 275 basis points, leaving the actual Fed funds rate at 2.50% -2.75%
Where UBS looks to sell the US dollar as a highs
UBS also favors the Australian dollar because of possible additional hikes by the RBA, or at least keeping interest rates high.
