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The stock markets are suffering enhanced turbulence that is affecting currencies as well. What is going on?

Here is their view, courtesy of eFXnews:

Nordea Research discusses the recent  equity market conditions  and argues that along with trade tensions, there are  larger forces at play, such as…

“i)  a weaker global macro environment (PMIs are falling),  ii)  the tide of dollar liquidity is ebbing as the Fed “unprints” money, while  iii)  ECB and BoJ are buying less per month,  iv)  Fed and others are still intent on lifting the short rates, and, not to be forgotten;  v)  the year-to-date widening of USD Libor/OIS has added to the tightening of global financial conditions,” Nordea argues.

“While recent price-action in markets has surely been influenced by quarter-end effects,  we continue to look for a near-term move higher in the USD. For instance, US data have recently been very strong vs the rest of the world, which often triggers USD gains after some delay,” Nordea adds.

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