USD: Morgan Stanley maintains a bullish view of the dollar ahead of the Fed meeting

In a note published this morning, Morgan Stanley maintains a bullish view on the USD ahead of this week's Fed meeting:

"We believe that USD should benefit from the Fed's higher rates. The market is not taking into account the possibility of a further rise in rates in the month of March and the risks seem oriented towards an increase in the pace of US monetary tightening.

The dollar should especially gain ground against emerging currencies and currencies linked to commodities, rather than against the EUR, which is boosted by a rather hawkish ECB meeting last week."