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6 Key FX Takeaways from 2020

  • March 23rd, 2020 probably marked a multi-year peak for the US dollar’s broad trade-weighted index. USD Indices generally move in 7-10 year cycles, and this cycle started in April 2011, and on March 23rd was 2.25 standard deviations above it's 10 year average.

  • The middle quarters of 2020 had the perfect set-up for USD depreciation – with lower US real yields and an upturn in global growth expectations. The former have stopped moving against the USD so could a short-term bounce in the narrow DXY index from current levels be possible?

  • The note also discusses EUR’s ‘safe haven’ characteristics and other FX trade ideas.

6 Key FX Takeaways from 2020
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