The global growth slowdown, the US-China trade war, the Hong Kong protests, and finally, COVID-19 have all dealt a severe blow to the HK economy. Naturally, fears have erupted along the way about whether the HKD peg will be able…
Highlights A currency portfolio comprised of the US dollar, the Japanese yen and the Norwegian krone is likely to outperform a more diversified basket over multiple macroeconomic scenarios. Our work suggests that valuation matters for…
Yesterday, BCA's Emerging Markets Strategy service argued that ongoing deflationary pressures in Malaysia are bearish for the MYR in the short-term. However, the Malaysian currency will sell off less than other EM currencies. Moreover…
The two main attributes of the US dollar are its counter-cyclical nature and its strong momentum characteristics. As we have argued, beyond the very near-term, where 2019-nCoV creates a risk to growth, the outlook for the…
Highlights Malaysian businesses and households have been deleveraging and the economy risks entering a debt deflation spiral. This macro-backdrop is bond bullish. EM fixed income-dedicated investors should keep an overweight position…
The improving economic outlook for the Australian economy points to a positive outcome for the AUD/USD. This is especially true as the AUD is historically the best performing currency in the G10 when global growth rebounds but…
Feature Everyone’s asset-allocation plans for the year have been disrupted by the novel coronavirus (2019-nCoV). Our view is that, while the virus is serious and will hurt the Chinese and global economy in the short term,…
Highlights Collective market signals suggest a low but non-negligible probability of a dollar spike due to the coronavirus. Stay long the yen as a portfolio hedge. Short CHF/JPY bets also make sense. Our limit sell on the gold/…
Highlights The liquidity-driven rally will soon be followed by an acceleration in global growth. The economic recovery will bump up expectations of long-term profit growth. The dollar has downside, but the euro will not benefit much…