Englander: Dollar Disappointment if Fed Holds Rates

The video discusses the current market expectations for a Federal Reserve rate increase, noting that no significant increase is expected until the middle of next year. It analyzes the potential downside for the dollar if market predictions hold true, highlighting the shift from a divergent to a convergence trade. The Bank of Japan's recent decision to maintain its negative interest rates is examined, with skepticism about further rate cuts. Finally, the video predicts which currencies might rally against a weakening dollar, focusing on the euro and yen.

What is the current market expectation for a Fed rate increase above 50%?

• No increase expected

• Middle of next year

• By the end of this year

• Early next year

What is the main reason the dollar might face difficulties according to the market?

• High inflation

• Convergence trade

• Low unemployment

• Divergent trade

What was the market's expectation from the Bank of Japan's recent meeting?

• Introduction of new currency

• Increase in interest rates

• Continuation of current policies

• A significant policy change

What is a major hurdle for the Bank of Japan in implementing an effective stimulus plan?

• Rising inflation

• Deeper negative rates

• High employment

• Strong yen

Which currencies are expected to rally against a weaker dollar?

• British pound

• Canadian dollar

• Euro and yen

• Emerging market currencies