US Dollar firm as First Republic gets closure – BBH

"We finally have some closure on First Republic; the deal clears the deck for global monetary tightening to continue unabated," not analysts at BBH.

Recent data have been dollar-supportive

"The dollar is firm as First Republic gets closure.  DXY is trading higher for the third straight day just below 102 as the deal should help dial down banking sector risk in the U.S.  With most of Europe on holiday, the euro is trading lower near $1.10 and sterling is trading lower near $1.2520.  USD/JPY is trading at the highest since March 10 and is testing the 200-day moving average near 137.  It should eventually break above and near 137 and test the March 8 high near 138."

"Recent data have been dollar-supportive but until rate cuts this year are finally priced out, the dollar is likely to remain vulnerable.  Perhaps the First Republic deal and a hawkish Fed this week will open up the next stage higher for the greenback."

"After marathon talks, regulators seized the troubled bank and will sell the bulk of the assets to JPMorgan Chase.  JPMorgan will assume all of First Republic’s $92 bln in deposits as well as most of its assets, including nearly $175 bln in loans and $30 bln in securities.  In order to help facilitate the deal, the FDIC will share losses on Frist Republic’s loans and estimated it would see a $13 bln hit from the deal.  While the deal leads to even greater consolidation of the U.S. banking sector, it was a necessary one in order to address this long-festering problem.  We are cautiously optimistic that this resolution finally ends the banking sector turmoil that began nearly two months ago."