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Morgan Stanley See USD Due to Underperform Through Month-End

FOREX
  • On month-end FX rebalancing flows, Morgan Stanley write that their model expects the USD to underperform versus most currencies in the G10, with the exception of CHF, CAD and AUD.
  • However they caveat that the FX month-end strategy has not performed as well over the past few months relative to its performance in 2020. They note that last month, the dollar strengthened despite positive equity returns leading to their signal suggesting USD weakness.

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