31FX – West countries are attempting to reopen economies as they try to spark its mobility up. See how the dollar fairs and other currencies as this reopening may take effect.
Despite the improved tone on trade via a planned US-China trade chiefs call this week. Most Yuan watchers believe the latest trade calming comments will fall well short of settling the bilateral and what could soon emerge as multi-pronged disputes more generally.
The German Constitutional Court’s request for the ECB to show that its first sovereign QE program (PSPP) was “proportional” doesn’t look like a bridge too far to cross.
There could remain downside pressure on the EURUSD at least until the debt mutualization issues are resolved.
The Yen has a favorable balance between a currency that’s cheap on most metrics but doesn’t have a cost of carry as a disadvantage and acting as an anvil on its back.
Short Term Currency Trades
The US dollar can selectively sell-off if investors differentiate those economies returning to social normalcy sooner; Australia, China, New Zealand, South Korea, Sweden, and Taiwan are out in front on this metric.