For the past two weeks DXY has been range bound between 100 & 98 levels. But we see this a healthy consolidation before the next round of DXY weakness begins. Foreign investors will continue to diversify out of US assets in an environment where US returns are solid but not exceptional. For e.g. US equities are back to flat on the year but for a EUR-based investor they are down 8%, which puts the relative performance to European equities in even starker contrast. Hence we expect EUR to reach 1.17 & JPY to reach 140 by Sep’25. On GBP we are relatively less bullish compared to EUR & hence like to be long EURGBP. We remain moderately +ve on AUD expecting to see .6550 by June end. We think AUD remains somewhat undervalued relative to key historic drivers, such as commodity prices. On CAD, we are mildly bearish because we view the last week BOC meeting as more dovish than neutral. We expect to see CAD reach 1.38 levels by June end. On CHF, we believe SNB might cut rates by 50 bps in it's 19th June meeting & hence expect to see CHF reach .84 by June end. We don't have a strong view on CNH currently as much might depend on US China trade talks this week. In the short term we see 7.15-7.30 range for CNH.
