The dollar was trading steady as it struggles to recover meaningfully after its recent selloff on concerns about weaker U.S. economic growth.
With market participants seeking to hedge against political uncertainty and a potential U.S. economic slowdown, the “last thing that springs to mind” is to buy the asset most exposed to those factors, Pepperstone strategist Michael Brown said in a note.
Any dollar rallies are good selling opportunities, he said. The euro could rise above $1.10 and sterling might exceed $1.30, although gains beyond these levels seem more likely for the euro given the grim U.K. economic backdrop, he said.
The euro and sterling traded flat at $1.0880 and $1.2931, respectively. The DXY dollar index was flat at 103.754.