Nomura says a weaker USD may be as soon as Q2, citing US yields stabilising.
- US yields should have run their course
- financial flows are likely to turn back against the dollar
- probably from mid-to-late Q2
Nomura are wary of potential Fed action to counter any further spikes in yields.
Further out:
- in Q3 and Q4 2021 ... likely US Fed tapering discussions/risks
- and longer-term drivers of USD weaker remain: including twin deficits and USD overvaluation
