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RBC Part 2 - 2018 FX Themes

FOREX
FOREX: RBC Part 2 - 2018 FX Themes
* RBC set out their G10 and EM thematic trades for 2018. Policy normalisation
and political risk are persistent themes, though the currency implications in
2018 are very different to 2017 (the exact opposite in some cases).
* They retain a recurring bias toward yield and carry, but include some hedges
in vol space that will perform if this changes.
* In net terms, are short EUR, SEK, NOK and GBP and long JPY, NZD and CAD. Long
USD/CHF remains their favoured play on US tax reform.
* In EM, they focus primarily on RV within Asia and within Latam. Prefer IDR
over SGD and KRW. In Latam, they are long BRL and COP; short MXN and CLP.

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