Bullish on USD vs EUR, JPY - RBS

By FXstreet.com | Updated July 30, 2014 AAA

FXStreet (Bali) - Greg Gibbs, FX Strategist at RBS, shares his view on the FX market, noting that USD still offers buy opportunities vs the EUR and JPY.

Key Quotes

"We would buy USD vs. EUR and JPY even though it feels like a patience trade. As discussed last week, we think the market is underpricing the risk of hikes in the US, whereas policy is likely to generate low rates in the Eurozone and Japan for much longer."

"The GBP has had a run on higher rate expectations; the risk is that this cools somewhat after the lower-than-expected inflation reported last week and focus on macroprudential measures this week in the UK."

"The prospect of further steady improvement in US economic data this week and a higher PCE deflator, in line with higher US and Canadian CPI last week, may see US yields creep higher, particularly at the front end, in my view."

"Record low FX implied volatility and similarly low credit spreads suggest high yield currencies may continue to grind higher, but EM markets are struggling to rally despite the risk-positive environment."

You May Also Like

COMPANIES IN THIS ARTICLE
Related Forex Analysis
  1. Forex News

    GBP/USD Technical Analysis: Initial Long Trade Profit Taken

  2. Forex News

    USD/JPY: Yen extends gains amid USD weakness

  3. Forex News

    Portfolio shift by Japanese pension funds to limit USD/JPY downside risk in 2015 ...

  4. Forex News

    GBP/USD hovers near fresh highs above 1.5400

  5. Forex News

    Japan's CPI's lower than expected - Rabobank

Trading Center