Contrarian Trades Dominate G10 FX Performance 💱
Bank of America Global Research notes that the G10 FX market appears stuck in tight ranges, with the GBP being this year's standout performer, followed by CHF. Conversely, the NOK and JPY have been the worst performers. Interestingly, all four outcomes would have been excellent contrarian trades, as the market consensus was expecting the exact opposite.
USD Strength Potential Amid Mixed Market Views 💹
BofA reports that while the market consensus remains bearish on the USD, clients are perplexed by the inability of the EUR/USD to sustain a rally this year, despite persistent Eurozone core inflation and a hawkish ECB. The majority still expects rate cuts next year, but some USD strength might emerge once the market prices out the cuts for this year.