FX Weekly

This report provides weekly G10 FX market analysis, emphasizing that current market expectations for Fed rate hikes are likely too hawkish. It outlines revisions to JPY, AUD, NZD, and CAD forecasts amidst shifting central bank policy trajectories and geopolitical risks.

Key Takeaways

• 1.Markets are leaning too hawkish on the Fed, and we do not expect a sustained US inflation overshoot.
• 2.BoJ intervention in support of JPY remains likely despite records showing limited impact on USD/JPY trajectory.
• 3.AUD and NZD forecasts downgraded as both currencies lose interest rate and commodity price advantages.

Table of Contents

• Talk is cheap; verbal intervention - overrated
• G10 FX Forecasts
• G10 FX Portfolio
• FX Focus
• JPY: intervention against all odds
• AUD: losing its advantage
• NZD: bumpy road to recovery
• CAD: not that far behind
• FX Focus recent publications
• Week ahead: key themes & trades
• FX Positioning Update
• FAST FX Fair Value Model Update
• Short-term fair value charts
• FX Fair Value Model Update
• FX Risk Index

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