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Westpac's G10 FX Model "returns to a..........>

FOREX
FOREX: Westpac's G10 FX Model "returns to a neutral USD stance after shorting it
without much success the last couple months. The main catalysts for the
turnaround are; 1) a stronger growth signal in the wake of last week's firm
regional PMIs and strong retail sales; and 2) a stronger yield signal reflecting
the renewed widening in 10yr spreads in the USD's favour. The model also finally
gives up on its long held EUR and JPY longs, poor PMIs and lower bund and JGB
yields key drivers. Among the dollar bloc CAD is still the favoured currency
thanks to Canada's relatively healthier growth signal compared to AUD and NZD
and relatively stronger commodity price basket (i.e. oil prices outperforming
iron ore, coal and dairy)."
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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