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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 and their 'fair' value, using the ‘Big Mac Index’ (BMI) approach (Jan 2022 updates) popularized by the Economist in 1986.
- Given that Big Macs are sold universally, we can imply an exchange rate depending on how expensive/ cheap are the big macs sold in different countries. It follows the Law of One Price:
- “In an efficient market all identical goods must have only one price".
- HUF, JPY and PLN are the most ‘undervalued’ currencies among the G10+CEE world, by -46.8%, -41.7% and -40.8%, respectively, against the US Dollar.
- CHF remains the most ‘expensive' currency based on that approach, overvalued by 20.2%, followed by NOK, which appears 10% ‘overvalued against the greenback.
- AUD and NZD are also strongly 'undervalued' (by more than 20%) using the BMI 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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