EM FX Daily Report

This report provides daily commentary on Emerging Market FX pairs, specifically highlighting long positions in TRY and HUF, and a strategic short on USDZAR. The author notes that while a hawkish Fed poses a broader headwind, local idiosyncratic factors continue to drive currency performance.

Key Takeaways

• 1.The author maintains a bullish stance on the Turkish Lira (TRY) due to contained retail dollarization and political risk easing.
• 2.The author is rebuilding short positions in USDZAR, anticipating rand outperformance despite a hawkish Fed, supported by improved terms of trade.
• 3.The author remains long HUF, citing cleaner positioning and support from recent geopolitical developments.

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