samedi 18 avril 2015
Week Ahead: Carry Is Back, USD Pause, JPY A Sell, GBP Rising
Posted on 00:06 by nice news
Uncertainty about the start of the Fed tightening cycle lingers, with recent US data not conclusive enough to support the case for an early stimulus removal. Our call remains for lift-off in September and we maintain our constructive outlook for the dollar over the medium term.
However, with the Fed still divided on the timing of lift-off and the concerns about the economic impact from the strong USD, consolidation in the USD could persist in the early stages of Q2. This in turn could boost the near-term outlook for risk-sensitive G10 currencies.
Our FX scorecard model suggests that the likes of AUD and CAD are among the most attractive currencies whereas CHF and even JPY among the least attractive currencies. We maintain a very bearish view on JPY and expect renewed weakness vs. AUD, NZD, CAD and NOK.
A potential Greek default remains a worry, and investors will increasingly focus on the upcoming Greek payments to the IMF in early May. That said, the lack of contagion so far seems to suggest that markets are willing to wait longer for a resolution if needed. In turn, global risk appetite could remain resilient.
What we’re watching
EUR: Caught between Greece and improving data. We expect improving business confidence next week to corroborate the view that QE is working. Uneasiness about Greece could persist, however.
USD: A pause, not a trend reversal. Uncertainty about the start of the Fed tightening cycle could encourage more unwinding of USD-longs against riskcorrelated currencies.
JPY: Time to sell. The JPY could lose more ground against risk-correlated currencies ahead of the BoJ’s Economic Outlook release on 30 April. (for more on JPY outlook, see here)
GBP: Still rising – but election risks could temper gains. A unanimous MPC and strong March retail sales print should support GBP next week, but watch out for volatility around election opinion-poll
However, with the Fed still divided on the timing of lift-off and the concerns about the economic impact from the strong USD, consolidation in the USD could persist in the early stages of Q2. This in turn could boost the near-term outlook for risk-sensitive G10 currencies.
Our FX scorecard model suggests that the likes of AUD and CAD are among the most attractive currencies whereas CHF and even JPY among the least attractive currencies. We maintain a very bearish view on JPY and expect renewed weakness vs. AUD, NZD, CAD and NOK.
A potential Greek default remains a worry, and investors will increasingly focus on the upcoming Greek payments to the IMF in early May. That said, the lack of contagion so far seems to suggest that markets are willing to wait longer for a resolution if needed. In turn, global risk appetite could remain resilient.
What we’re watching
EUR: Caught between Greece and improving data. We expect improving business confidence next week to corroborate the view that QE is working. Uneasiness about Greece could persist, however.
USD: A pause, not a trend reversal. Uncertainty about the start of the Fed tightening cycle could encourage more unwinding of USD-longs against riskcorrelated currencies.
JPY: Time to sell. The JPY could lose more ground against risk-correlated currencies ahead of the BoJ’s Economic Outlook release on 30 April. (for more on JPY outlook, see here)
GBP: Still rising – but election risks could temper gains. A unanimous MPC and strong March retail sales print should support GBP next week, but watch out for volatility around election opinion-poll
Week Ahead: Carry Is Back, USD Pause, JPY A Sell, GBP Rising
Inscription à :
Publier les commentaires (Atom)
0 commentaires:
Enregistrer un commentaire