The margin for those expecting USD gains to continue for the next 6 months is slim:
- 26 of 50 those surveyed
In brief summary of the poll results:
Coronavirus outbreak will prop safe havens - yen and CHF to gain alongside the USD index
- emerging market currencies, assets to suffer
But, forecasts for a year out:
- EUR/USD +4%
- yen,+1.5% against the USD
- GBP/USD +4%
Some of comments from respondents are more interesting than those forecasts really:
- "As we speak, there is no information suggesting that there has been any sort of peak in the coronavirus. The only information that we've got is that it is spreading to other countries," said Jane Foley, head of FX strategy at Rabobank. "As long as the news flow is consistent with that, I think it is very likely that the dollar, the yen and Swiss franc will remain well bid and emerging markets will be out of favor."
- "Emerging markets benefit from low rates and easy money, but they're very vulnerable to significant economic slowdown. In the short term, they are just getting knocked from pillar to post by the virus and by sentiment," said Kit Juckes, head of currency strategy at Societe Generale. "It is clear that the Chinese economy is going to slow, the Chinese are going to use monetary policy and will probably have a period where resource prices - industrial metals and oil prices - are going to be under some pressure. If you're in Latin America, you may think you're closer to America physically, but you are probably closer to China economically."
