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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
FOREX
- The chart below ranks the major G9 and CEE currencies based on their percentage difference between the current spot rate (vs. the US Dollar) and their 'fair' value, which we define using a Behavioral Equilibrium Exchange Rate (BEER) model (using terms of trade, inflation and 10y interest rate differentials as explanatory variables).
- Despite their strong recovery since March 2020, the British pound and the Aussie are the most undervalued currencies, -11.7% and -11.2% according to our model. It is important to emphasize that both currencies are considered 'risk-on assets' that tend to appreciate when volatility eases.
- HUF also remains significantly undervalued (-10.4%) despite the strong momentum we saw in April and May.
- On the other hand, the Swiss Franc is the most expensive currency, +8.6% against USD (also strongly overvalued using the PPP approach).
Source: Bloomberg/MNI
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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