Credit Agricole CIB Research maintains a bullish bias on the USD in the near-term.

"The USD near-term outlook would also depend on its attractiveness as a safe- haven, and next week investors will focus on the outcome of the US-China summit & the evolving situation in the Middle East. Any potential re-escalation of global trade and/or geopolitical tensions could burnish the appeal of the high-yielding, safe-haven King of FX. We note, however, that most of the portfolio inflows into the US so far this year have been dominated by purchases of risk-correlated assets. This has weakened the hitherto strong positive correlation between the USD and risk aversion, in our view," CACIB notes.

'In all, we maintain a constructive outlook on the USD in the very near term. While the latest FX price action meant that the USD has started to ‘close the gap’ to its relative rate and yield appeal vs the rest of G10, it continues to trade at a huge discount vs these fundamental drivers," CACIB adds.