FXStreet (Guatemala) – Analysts at Scotiabank offered an outlook for the currencies relevant to the various global blocks of economies.
Key Quotes:
“AMERICAS
The USD will remain in favour as the Fed initiates a gradual process of monetary policy normalization that will likely weigh on the CAD and MXN through the remainder of the year. The BRL will retain a bearish tone driven by the adverse effects of an acute fiscal adjustment. The commodity-intensive CLP and PEN will prepare for a negative shock from the Fed tightening.
EUROPE
The EUR will resume a weakening phase, which will pave the way for parity with the USD over the next 18 months. Monetary policy divergence will be the primary driver of EUR weakness as ECB policy accommodation is fully implemented. The GBP will maintain a stable trading range versus the USD, with the BoE implementing its own policy normalization with a modest lag to the Fed.
ASIA/PACIFIC
Relative dynamics will continue to weigh on the JPY, its stance of accommodation the most aggressive among its peers. The CNY is expected to strengthen modestly with a broader focus on financial stability. The AUD is vulnerable to a period of renewed depreciation, as RBA policymakers remain attentive to exchange rate dynamics.”
(Market News Provided by FXstreet)