Back
18 Mar 2014
Flash: USD to snap higher - BAML
FXStreet (Guatemala) - John Hopkinson, FX Strategist at Bank of America Merrill Lynch explained they believe that once US data begin to improve with the weather, the USD could snap higher in a relatively short space of time.
Key Quotes:
“One number that may have been materially impacted by weather was the January ISM manufacturing PMI."
"Investors are now looking through the weather so that March PMI, which is released prior to payrolls, may be expected to rebound. Will an expected strong number trigger a Dollar rally? The flow implications for equities mean that through April and May, it will, in our view."
"Equity investments are rarely currency-hedged, so equity flows frequently have a currency impact. With rates forecast to begin rising, capital has begun to flow from bonds to equities. This rotation, which arguably began in earnest in May 2013, has increased the importance of equity flows as a driver of currencies”.
Key Quotes:
“One number that may have been materially impacted by weather was the January ISM manufacturing PMI."
"Investors are now looking through the weather so that March PMI, which is released prior to payrolls, may be expected to rebound. Will an expected strong number trigger a Dollar rally? The flow implications for equities mean that through April and May, it will, in our view."
"Equity investments are rarely currency-hedged, so equity flows frequently have a currency impact. With rates forecast to begin rising, capital has begun to flow from bonds to equities. This rotation, which arguably began in earnest in May 2013, has increased the importance of equity flows as a driver of currencies”.