The dollar’s immediate direction will be set by the Fed’s rate decision on Wednesday. Overall, a 0.25% increase is the most likely outcome, although with a 20% chance of a 0.5% hike. Without a 0.5% increase and evidence of a more aggressive Fed stance in August, the US currency is likely to weaken. Conversely, an aggressive stance would be likely to push the dollar towards 1.18. The dollar will also be vulnerable if there is evidence of an economic slowdown. The dollar will be vulnerable to security concerns and there is a strong probability that the currency will be sold at some point during the third quarter due to ... (full story)