Geopolitics still matters but sensitivity to exchange rates is not what it once was. There's headline fatigue. What's coming into frame is what central banks will do next. Some will raise rates in response to elevated oil prices and higher inflation.

On one hand we're thinking about geopolitics, on the other hand that's not going to be driving FX as much because we're thinking about what's going to happen with the data and how central banks will move their policy rates.

The dollar is stuck in a soft orbit. The key question is who Kevin Warsh will be - the dove the administration wants or showing his old hawkish stripes. That will dictate the next big move on the dollar.

If he's relatively balanced, it keeps the dollar in a soft position.

Whenever the dollar falls fast, de-dollarization becomes a popular narrative. It ran out of steam in Q3 last year. Central banks are diversifying reserves but foreign demand for US assets still requires dollar buying. It's happening but very glacial.

If you look at what foreigners are doing with their demand for US assets, presumably that still requires them to be buying some dollars.

Many are concerned about pushing through 160 after the forceful intervention. But the BOJ is expected to raise rates at its next meeting, and then we'll decipher the Fed's outlook. If there's monetary policy divergence with a more hawkish Fed, 160 may not be a ceiling.

160 is on the radar, causing hesitation to push through it.