Weekly Report

The conditions are in place for the U.S. dollar to experience an upside reversal: the greenback is technically oversold and the Fed is turning hawkish.

However, the bond market is second guessing the Fed. Treasury yields are grinding lower, the yield curve is flattening, and inflation breakevens are rolling over. All this points to a slowing economy. Additionally, the breakeven inflation curve is inverted, which signals that the current spike in inflation is not expected to last.

Will the bond market be proven correct? How much upside is there for the dollar and how long could it last? If you’re interested in more, please visit Alpine Macro’s website for our latest Global Fixed Income & Currency Strategy report.