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Mar 26 - 12:55 PM

Credit Agricole: Prelim Month-End Fixing Model Points to Moderate USD Selling Into this Month Fix

By eFXdata  —  Mar 26 - 11:00 AM

Synopsis:

Credit Agricole's analysis of March's financial market movements, including the rise in global equity markets and the USD's overall strength, indicates a trend towards moderate USD selling at the month-end fixing. The prediction stems from a preliminary examination of portfolio-rebalancing flows, taking into account the month's currency performance and equity market adjustments based on market capitalization.

Key Points:

  • Global Equity Market Performance: Equity markets have seen increases globally throughout March, influencing currency movements and portfolio rebalancing strategies.
  • USD's Position: Despite its general firmness throughout the month, the USD is anticipated to face selling pressure in the context of month-end adjustments.
  • Specific Signals: The analysis identifies a particularly strong signal for USD selling against the Swedish Krona (SEK), highlighting it as a standout among G10 currencies for potential rebalancing flows.

Conclusion:

Credit Agricole's model points towards a scenario of mild USD selling across various currencies as part of month-end portfolio rebalancing, with a notable emphasis on the USD/SEK pair. Investors and market participants may anticipate adjustments reflecting these predicted shifts, aligning their strategies with the expected currency movements at month's end.

Source:
Crédit Agricole Research/Market Commentary

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