📝High Beta FX May Outperform During Dollar Correction: ING FX Strategy

Noting three factors driving the dollar correction. 1)U.K.'s 'U-Turn' of fiscal policies 2)Risk on trading 3)Lower gas prices.

A quiet week for US data could see the dollar correction extend a little. High beta currencies which trade on higher implied volatilities, eg AUD, NZD, NOK, SEK and possibly GBP may outperform during this period. And the case could be made for DXY heading back to 110 (another 2% drop).

But a core view of not just the Fed, but other central banks hiking into a looming recession should mean that the core dollar bull trend remains intact.

- ING FX Strategy