XE Market Analysis: Europe – Jun 25, 2019

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The Dollar hit fresh lows against the Euro and Yen, among other currencies, with the Treasury market having continued to price in Fed easing. Fed funds futures are fully pricing-in a 25 bp rate cut at the late July FOMC, and are factoring about 40% odds for a 50 bp move then. The market is also fulling discounting just over three 25 bp rate cuts by year end, and 100 bp worth of easing by mid-2020. Against this backdrop the USD index (DXY) earlier carved out a new three-month low, at 95.85, in what is now the fifth consecutive day of declines.