G10 FX remains quiet, despite the sharp.......>

FOREX: G10 FX remains quiet, despite the sharp price moves in equity and fixed

income - NZD modestly outperforming with CHF the laggard. Some head-scratching

going on as to why stereotypical safe havens (CHF, JPY) haven't benefited from

the equity and bond sell-off:

-The answer appears to be in high beta currencies (ZAR, PLN, RUB, TRY), which

have been relatively stable despite domestic equity markets suffering. Some

select currencies have dropped (ILS, IDR, BRL), however the moves are well

within recent volatility and price ranges.

-The contained price action in global FX and lack of follow-through from falling

stock prices may suggest that the recent price slump in equities at this stage

is fast-money driven and more a result of profit-taking (albeit in size) rather

than a sea change in sentiment for the broader investment landscape.

-It may be some time before this theory can be proven correct or false, but the

longer spot FX stays sanguine, the more likely this is to be the case.