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FUNDAMENTALS BATTLE POSITIONING, REAL YIELDS SUPPORT THE USD

  • Regular
  • FX Market
  • 4 weeks ago
  • 24

Fundamentals are battling excessive positioning in several currencies, including the AUD and NZD where positioning data suggest that the market is near record net shorts.  

"After around six months of exodus, funds may also be looking to rebuild positions in emerging markets. "
"Asia has lagged other regions recently as the market continues to worry about the economic outlook in China and headwinds from sour trade relations with the US."
"Nevertheless, it is participating in a recovery in risk assets in the last week."
"The capacity for a sustained retreat in the USD against other major and EM currencies may be limited by the recent strong gains in real long-term yields in the US.  This may be limiting the recovery in EUR and GBP."

Source : AMPGFX