According to Mark McCormick, North American Head of FX Strategy at TD Securities, the major currencies continue to chop around in well-contained ranges.
Key Quotes
“For the USD, we still like it lower against the major reserve currencies but it will likely take some time for this theme to play out. The midterms offer the next major pivot point but we note the much of the USD’s strength runs through relative equity performance.”
“The European majors got a boost from a mix of politics and some early signs of local reflation. Norway inflation beat expectations while the BoE’s Haldane highlighted the early signs of higher UK wage growth.”
“The Brexit newsflow is heading in the right direction while GBPUSD HFFV points to 1.35. That could reinforce topside in GBPCHF while EURUSD holds key levels at the bottom end of the range.”
“JPY looks the most disconnected from cyclical drivers, highlighting downside in CHFJPY. We also now like fading the rallies and in USDJPY and like buying 1y straddles.”
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