Lower volatility is favoring the carry trade, with currencies from Latin America and Central and Eastern Europe offering the highest risk-adjusted returns, economists report. ENG.
The dollar works well in the world of carry trade
“The highlights are the lower levels of volatility of currencies traded around the world, in both developed and emerging countries. The lower levels of volatility go hand in hand with a slightly more constructive risk environment, in which that the MSCI World stock index is nearing its highs for the year”.
“The currencies of Latin America (especially the Mexican peso) and Central and Eastern Europe (especially the hungarian forint) offer the best risk-adjusted return. They have been the best performers this year and could continue to do well unless the US debt ceiling negotiations take a turn for the worse.”
“Let’s expect the dollar to remain slightly bullish in this volatile currency environment until there are much clearer signs of disinflation in the US and slowing activity, which is more of a third-quarter story in our view.” quarter.”
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
