HSBC: The key to the US dollar lies in US trade policy, not monetary policy.

According to HSBC Global Research economists, the key to the dollar's move may depend more on the evolution of U.S. trade policy than monetary policy. "For the US dollar, the FOMC stance in March was neutral enough that it did not challenge the prevailing bearish sentiment for the dollar, especially as US Treasury yields fell," they said in a note. But they said it wasn't enough to spur a sustained sell-off in the dollar. They said that after a strong start to the year, the Fed continues to take a wait-and-see approach, so there is reason to be more cautious about short-term yields and keep its expectations for the 10-year Treasury yield unchanged at 3.50% by the end of 2025. These economists believe that the US stock market is likely to clear further, as some of the bank's indicators show oversold levels. (Golden Ten)