G10 carry trade suffers from weak foundation – TDS

Research Team at TDS, suggests that the macro conditions have had a notable shift in the past month, leading to a squeeze in the USD and resumption of G10 carry and momentum strategies.

Key Quotes

“We think Yellen’s dovish shift in March and a modest lift in global growth conditions at the start of Q2 has helped fuel the risk rally in the G10.

However, the resurgence in risk appetite sits on shaky foundations and next week’s Fed meeting could act as a trigger for a reversal in the price action.”