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#1 08-01-2018 11:54:11

johnedward
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From: Paris - France
Registered: 21-12-2009
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Which currency is likely to be weakest in 2018? HSBC's top 2018 trade

Which currency is likely to be weakest in 2018? Here is HSBC's top trade for this year


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HSBC shares a marcoeconomic analysis and identifies a possible trading opportunity for this year 2018.

"We have analysed the situation in New Zealand. It seems to us that the sale of NZD could very well be the macroeconomic trade of 2018. Here are the reasons:

1- A new government that has anti-business ideas. The premier described capitalism in New Zealand as a "blatant failure".

2- Probably the most overrated real estate market in the world.

3- Real estate prices and activity are already down.

4- And here are also three harmful effects to the real estate market:
a) Macro-prudential measures introduced in the last two years are starting to have a negative impact.

b) Foreign buyers will be prohibited from buying NZ real estate. This is potentially very important.

c) Immigration to New Zealand is expected to fall by almost 35%. More than 60% of migrants in NZ come in the "qualified and business" category, buyers of real estate less so.

All this is not new, but it is a time when we ask ourselves questions about the major themes of 2018, and we think that it is one.

The buying of AUD/NZD is not our favourite choice to express this trade, because of China which reduces its imports, which could weigh on the prices of raw materials (and thus on the AUD). Moreover, the recent rise in commodity prices has not benefited correlated currencies at all, which is a problem.

In our opinion, buying the EUR/NZD to target 1.8200 or 1.8500 is more optimal."


"Anything worth having is worth going for - all the way." - J.R. Ewing

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