Global FX weekly

Latest edition · October 2, 2026

BofA Global FX weekly Déjà EUR 2026 10 02

BofA highlights ongoing USD strength and EURUSD vulnerability as the cross knocks on year-to-date lows amid widening OAT-Bund spreads and front-end repricing. In EM FX, selective value is emerging post-sell-off in PHP, KRW, and TWD, while the team initiates a short MXN/CLP position driven by monetary policy divergence.

The Global FX Weekly highlights that the USD retains near-term upward momentum across heatmap, option flow, and quant technical metrics, while EUR/USD remains vulnerable near YTD lows, tracking OAT-Bund spread widening. In broader G10 FX, EUR/CHF has cracked under French contagion and global yield curve steepening, GBP demonstrates resilience thanks to solid FDI and BoE QT changes, and NOK/SEK appears stretched versus fundamentals. Across EM, despite aggregate EMFX remaining >10% overvalued on BEER models, expectations-adjusted value is opening up in North Asian and export currencies like PHP, KRW, and TWD. Strategists recommend shorting MXN/CLP as Chile hikes while Banxico pauses, while cautioning that IDR faces narrowing rate differentials and dwindling net foreign reserve buffers.

Key takeaways from the latest edition

• 1.EURUSD is testing year-to-date lows and trading tightly with front-end yield differentials and widening OAT-Bund spreads (-0.4% per 10bp spread widening), with quant models showing strong USD bullish continuation signals.
• 2.Emerging Market FX is more than 10% overvalued in aggregate according to BEER models, but selective value is opening up after the sell-off, especially in PHP, KRW, and TWD when adjusted for macro expectations.
• 3.In LatAm FX, BofA initiates a short MXN/CLP trade (entry 54.35, target 52.00) based on policy divergence: Banxico is decoupling from the Fed and staying on hold at 6.5% through 2027, while Chile's central bank is poised to hike 50bp to counter sticky inflation.

What this series covers

• Key views, forecasts and latest trades
• Week ahead
• The view
• G10 Themes
• USD: Changing tides as midterms approach
• EURUSD knocking on YTD lows
• August CPI review: Softer CPI print, but underlying pressures persist
• EM Themes
• EMFX: More turbulence ahead
• Sell MXN/CLP – While Mexico Takes a Siesta, Chile Goes Hiking
• IDR faces headwind from narrowing rate-differentials
• Frontier FX: After the rates storm
• Quant & Vol Insights
• Trade Recommendations G10
• Trade Recommendations EM
• World At A Glance Projections

Edition archive

• BofA Global FX weekly Déjà EUR 2026 10 02

  October 2, 2026

• Global FX weekly Paying top dollar

  September 25, 2026

• Global FX weekly Raise you a hawk

  September 18, 2026

• Global FX weekly Front and Centre

  September 11, 2026

• Global FX weekly Means to a Yen

  September 4, 2026

• Dollar unmasked

  August 7, 2026