Weekly FX Chartbook: The return of US exceptionalism Weekly FX Chartbook: The return of US exceptionalism Weekly FX Chartbook: The return of US exceptionalism

Weekly FX Chartbook: The return of US exceptionalism

Forex 5 minutes to read
Charu Chanana

Head of FX Strategy

Summary:  After a heavy week of dovish undertones from the key central banks last week, focus has returned to US exceptionalism coming in sharp contrast to the need for bringing forward rate cut bets from the likes of Bank of England or Reserve Bank of New Zealand. The Chinese yuan is also under scrutiny after flip-flop in PBOC fixing potentially as a result of yen weakness extending further. Earnings from property developers and banks in focus in China this week, and could have repercussions for CNH and AUD.


Dollar strength returned to the fore last week with a summer of rate cuts looking likely and prompting dovish repricing for other major central banks after a surprise SNB rate cut, but Gold still held up well.
Our FX Scorecard shows momentum turning negative for Silver and sterling, while USD strength could become the key theme again.
Forex COT to the week of March 19 indicated non-commercial flows heavily tilting towards a long dollar positioning ahead of the FOMC meeting. This was led by a 35% reduction in EUR longs and 24% reduction in GBP longs. In addition, shorts in JPY, AUD and CHF increased further.

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