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CACIB update ahead of month-end. Our model....>

FOREX
FOREX: CACIB update ahead of month-end.
Our model expects month-end flows to be strong USD buying across the board.
Global equity markets have sold off across the board this month. The S&P 500 has
fallen 9% since the start of October (at the time of writing), with similar
sharp declines in the other G10 equity markets. The weaker risk tone has also
seen broad USD gains vs the other G10 pairs this month, apart from against JPY.
However, this USD outperformance has barely offset any of the marked
underperformance seen in US equities when adjusted for market capitalisation; as
such, this suggests month-end portfolio-rebalancing flows are likely to be
strong USD buying across the board.

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