Credit Agricole CIB FX Strategy Research expects next week's US data (non-farm payrolls and ISM) to help the USD regain more ground against the 'laggards of the global divergence trade', JPY and CHF.
On the EUR front, CACIB notes that the single currency has been soft as of late as investors has dumping it in part because of concerns about the political outlook in Germany following the federal elections.
"The uneasiness could fade in our view as investors turn their attention to the still improving economic outlook in the Eurozone and the approaching October ECB meeting," CACIB argues.
On the AUD front, CACIB notes that the RBA meeting is unlikely to help the embattled AUD, as the Board will not significantly shift its rhetoric ahead the October Q3 CPI release
Trade-wise, key trades in CACIB's model portfolio contains long EUR/CHF*, long AUD/NZD* and also added a long EUR/USD* this week.
Source: Credit Agricole CIB ResearchOriginal Article
