FX Daily: Searching for 'Cockroaches'
Market attention remains focused on US regional banks this week, following Jamie Dimon's warning of potential 'cockroaches' (distressed lenders) after two US regional banks reported credit issues.
As the dollar faces substantial downside risks, markets will closely monitor for evidence of further credit issues. The upcoming US CPI release is expected to support Fed easing plans, rather than derailing them.
Concerns about the health of regional banks and the broader quality of credit in the US remain very central for FX markets.
This week's regional lenders' earnings releases will be closely watched for signs of weakness, with risks appearing to be tilted to the downside for the dollar.
Author's summary: Dollar faces downside risks amid US regional bank concerns.