Highlights China’s new plan for “common prosperity” is a long-term strategic plan to bulk up the middle class that will strengthen China – if it is implemented successfully. The record on implementing reforms…
Highlights The baht will depreciate further, given the state of the economy and external accounts. Domestic demand was already relapsing, even before the latest surge in COVID-19 cases. Now, the recovery will be delayed more. The…
There are two key risks to our foreign exchange strategists’ bearish outlook for the US dollar. The first is if the Fed changes its reaction function in favor of a proactive approach to tackling inflation. This would entail…
Highlights The chaotic US withdrawal from Afghanistan is symbolic – the US is conducting a strategic pivot to Asia Pacific to confront China. US-Iran negotiations are the linchpin of this pivot. If they fail, war risk will…
Dear client, FX will be taking a summer break next week. We will resume our regular publication the subsequent week. Kind regards, Chester Ntonifor, Vice President Foreign Exchange Strategy Highlights Our broad finding is that…
Highlights Going into the new crop year, we expect the course of the broad trade-weighted USD to dictate the path taken by grain and bean prices (Chart of the Week). Higher corn stocks in the coming crop year, flat wheat stocks and…
Japanese machine tool orders decelerated slightly to 93.4% y/y in July from June’s 96.6% y/y. Notably, foreign machine tool orders accelerated to 103.4% y/y from 99.5% y/y. Given that machine tool orders are one of the most…
Over the past three months, the Norwegian krone has been the worst performing G10 currency. However, a buying opportunity is opening up for this cyclical currency versus both the USD and EUR. First, our Foreign Exchange…
After surging earlier this year, the South African rand has been depreciating against the US dollar since the beginning of June. However, over the past two weeks, the ZAR has been strengthening vis-à-vis the greenback. The ZAR’s…