U.S. dollar softness to continue; Euro, yen best placed: PIMCO By Reuters

U.S. dollar softness to continue; Euro, yen best placed: PIMCO


© Reuters. FILE PHOTO: Euro, Hong Kong dollar, U.S. dollar, Japanese yen, pound and Chinese 100 yuan banknotes are seen in this picture illustration

By Aaron Saldanha and Lisa Pauline Mattackal

(Reuters) – The U.S. dollar is likely to continue weakening against developed market currencies after the U.S. Federal Reserve’s shift to a new monetary policy strategy, a portfolio manager at bond giant PIMCO said on Tuesday. Erin Browne, managing director and portfolio manager at PIMCO, told the Reuters Global Markets Forum she had become more bearish on the U.S. dollar () over the last three months.

Within developed markets, the euro () and Japanese yen were the “best structural longs,” said Browne, who co-manages the PIMCO Dynamic Multi-Asset Fund.

“Tactically, I also think Norway’s krone , sterling and Australian dollar offer value,” Browne said.

Fed Chair Jerome Powell on Wednesday could signal a switch in the Fed’s Treasury purchases toward longer-dated debt to keep long-term yields low, some strategists anticipate. ()

Browne said she did not expect the Fed to begin a yield curve control program at this time, nor another edition of “Operation Twist,” referring to the 1960s U.S. monetary policy aimed at influencing the yield curve .

The Fed recently rolled out a sweeping rewrite of its approach to its dual role of achieving maximum employment and stable prices, putting less weight on worries about too-high inflation.

On equities, Browne said U.S., European and select emerging market stocks are more attractive than their Japanese peers.

However, with global growth expected to rebound, Japan is set to benefit given its sensitivity to export growth, the co-manager of the PIMCO Global Core Asset Allocation Fund added.

“The policies of (Yoshihide) Suga will be very much in line with a continuation of Abenomics. This (leadership transition) should not be seen as a move away from the policy directives over the past decade.”

Suga is on track to become Japan’s new prime minister, succeeding Shinzo Abe, who resigned due to ill health.

(This interview was conducted in the Reuters Global Markets Forum, a chat room hosted on the Refinitiv Messenger platform. Sign up here to join GMF: https://refini.tv/33uoFoQ )

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



Source link

Leave a Reply

Your email address will not be published. Required fields are marked *


About us

InvestLab is a financial services technology company focused on the global trading market. Founded in 2010 in Hong Kong, the company develops trading, market data, and social research products that enable individual investors and small to mid-size brokers to access global markets. We provide brokers and financial institutions cross border capabilities for retail investors into 43 markets globally.


CONTACT US

CALL US ANYTIME