Bank of America Global Research constructed a G10 heatmap of likely G10 FX drivers this year.
“FX markets are already close to the end of 2023 consensus forecasts,
but this is a year with plenty of known unknowns. We are concerned
about the outlook of risk assets in the short-term, whether sticky
inflation during a recession will keep central banks hawkish,”BofA
notes.
“We constructed a G10 heatmap, looking at likely G10 FX
drivers this year. Although we expect USD strength in the short-term, on
the back of risk-off without a central bank policy put, our analysis is
positive for CAD, AUD and NOK vs. CHF, USD and SEK, which is consistent with our end-year forecasts,” BofA adds
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