According to BCA Research’s Foreign Exchange Strategy service highlights a tactical opportunity to go short the AUD/MXN cross. Three catalysts underpin this thesis: relative economic activity, valuation, and sentiment.…
Highlights For the month of February, our trading model recommends shorting the US dollar versus the euro and Swiss franc. While we agree a barbell strategy makes sense, we would rather hold the yen and the Scandinavian currencies.…
The Bank of England did not adjust monetary policy at the conclusion of its meeting on Thursday. The Bank Rate was maintained at 0.1% and its target stock of asset purchases was held at GBP 895 billion. Although the BoE revised…
Highlights US inflation expectations will continue to grind higher as commodity markets tighten, and financial markets price to an ultra-accommodative Fed over the next 2-3 years. The US stock-market rally is reducing equity yields…
Highlights We are hesitant to call a top to the volatility spike just yet. The US dollar is experiencing a counter-trend bounce. We also see political and geopolitical risks flashing yellow. House Democrats are drafting a…
The New Zealand economy is doing well. The most recent Westpac consumer confidence came in at 106, which was above pre-pandemic prints of 104.2. Moreover, the latest labor market data has been strong. However, this reality is…
At its meeting on Tuesday, the Reserve Bank of Australia surprised the consensus by announcing an increase in its quantitative easing measures, adding another A$100 billion in government bond purchases and extending the program…
BCA Research’s Emerging Markets Strategy service remains negative on the BRL. Brazilian stocks will only become a clear buy after their risk premium reflects fiscal challenges better. Rising resource prices and the…
Sweden has a small open economy that specializes in the exports of intermediate industrial goods. This property not only makes Sweden extremely sensitive to the global business cycle, but also, Sweden is among the first advanced…
Highlights The dollar bounce has further to run. The DXY index could touch 94 before working off oversold conditions. In this environment, yen long positions also provide an attractive hedge. Meanwhile, Japan has stepped back into…