Forex Flash: USD index 1-month target at 78.00 - Westpac

“There is the seasonal propensity for the US data to cool into mid-year while China’s recovery is likely to plateau by mid-2013,” says New York based Westpac analyst Richard Franulovich. “The early signs of a topping out in broad US financial conditions adds another layer of caution,” he notes.

With currently USD index trading around the 79.55 level, “We have a one month target for the USD index of 78.0,” Richard adds. “However, as we move deeper into Q2 the mosaic looks notably less supportive for risk appetite, an environment that should see the USD find its feet,” Mr Franulovich concludes.