United States Dollar Growth

United States Dollar Growth - This week has witnessed stronger-than-expected GDP growth (3 percent year on year)

As well as a larger-than-expected current account surplus (2.1 percent of GDP)

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Which has provided some internal support to the rand

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However, the domestic momentum for advances has once again been eclipsed by market risk aversion

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The Consumer Price Index (CPI) in the United States recorded inflation and core inflation at 8.6 percent year on year in May 2022

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Core CPI data indicated inflation at 6%, compared to 5.9% predicted

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Higher inflation supports the world's largest economy's a faster rate of monetary tightening, and as a result, US Treasury yields and the US dollar have strengthened

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At the R15.30/$ support level, the USD/ZAR has established a bullish (engulfing) price reversal

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The stochastic oscillator moves out of the oversold condition and breaks through trend line resistance to signal the reversal

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The price has gotten dangerously near to its original resistance objective of R15.70/$

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