Market Insights: US GDP and will the US Dollar Weakness Persist?

A lot's been happening in the markets lately, and I've been itching to discuss it with you. We're witnessing a hint of weakness in the US dollar, a trend that's driven it down against various currencies. Last week was surprisingly quiet, not much activity or significant news shaking things up.

However, looking ahead, the upcoming US GDP release is something to keep an eye on. The consensus is projecting a substantial leap to 4.9%, a notable jump from the previous 2.1%. But let's recall Jerome Powell's recent speeches hinting at a stronger GDP in Q3 followed by a potentially weaker Q4. Tomorrow's release at 12:30 might sway the dollar's strength accordingly.

A higher GDP could bolster the US dollar, possibly hitting around 5.2 or 5.0. Conversely, a lower figure might pave the way for a softer dollar by year-end. It's crucial to gauge this GDP report's impact on the dollar's trajectory.

Beyond the GDP, watch out for the retailer inventories and the Spanish CPI, with expectations set at 3.7%. While the Spanish CPI might not have a direct effect on the Euro, remember that Germany holds substantial influence within the Eurozone, impacting movements in the Eurodollar.

If the US GDP comes in lower than anticipated, expect the Eurodollar to potentially climb towards the year's end. However, a higher GDP might maintain the status quo. Investors are already pricing in a pause in December for the FOMC, limiting potential substantial strengthening.

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