The continued weakness in the dollar since mid-May raises the prospect of a temporary end to the outperformance of US equities. US equities tend to do better when the dollar is strong. Arithmetic plays a role in this…
Highlights The dollar is likely to churn on recent weakness before a cyclical bear market fully unfolds. The reason is that the economic landscape remains fraught with uncertainty, both politically and economically. We continue to…
Highlights Our base case reflects our view that China’s strong fiscal and monetary stimulus, combined with a weaker US dollar, will provide a favorable backdrop for copper markets in 2H20. Supply factors are for the most part…
Highlights Risks assets have entered a FOMO-driven mania phase that could last for a few more weeks. Markets are ignoring the particularities of this recession and are treating the post-lockdown activity snapback as a V-shaped…
The Swedish krona remains one of our Foreign Exchange Strategy team’s preferred G-10 currencies. The real trade-weighted SEK stands well below its long-term fair value model. Moreover, the SEK trades 13.4% and 36.3%…
Highlights The Chinese economy continues to recover, albeit less quickly than the first two months following a re-opening of the economy. The demand side of the Chinese economic recovery in May marginally outpaced the supply side,…
A rules-based approach in trading foreign exchange can provide some sort of anchor amidst rapidly changing market narratives. Our Foreign Exchange Strategy service constructs its currency portfolio based on three criteria…
An analysis on Turkey is available below. Highlights Due to the sizable stimulus announced by the NPC, we are upgrading our outlook for Chinese growth for this year. Nevertheless, in terms of investment strategy, we are…
Recently, BCA Research's Emerging Markets Strategy service explored a three-pronged framework to think about EM exchange rates versus the US dollar in a world awash with QE. First, EM currencies in aggregate will continue…