G10 FX Model Update

This report provides an update on HSBC's G10 FX models, noting that the DXY is currently at the top of its modelled range. It highlights divergence in currency valuations, with GBP, JPY, and NZD looking 'rich' while EUR and CHF appear 'cheap'.

Key Takeaways

• 1.The DXY index is currently at the top of the modelled range.
• 2.GBP, JPY, and NZD are currently screening as 'rich' against modelled ranges, while CHF and EUR appear 'cheap'.
• 3.Speculative net short JPY positioning is at near-record levels, implying a potential for significant market reaction.

Table of Contents

• G10 FX model update
• Currencies Developed Markets
• Disclosures & Disclaimer
• Appendix 1: Methodology
• Disclosure appendix
• Disclaimer

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