The Dollar

…dollar is still again going back to some of the real money positioning data we have. It's still under owned. I think specs the price action last week after payrolls especially shows you spec money was probably long of dollars to a pretty extreme degree because that was not that bad of a payroll report and the dollar got crushed on the day. So that kind of tells you the point of paying short term was the positions were overweight. But that's not the case with longer term focused investors. They're still really underweight. And so I think the path of least resistance right now is that the U.S. labor market as they say it looks absolutely fine. U.S. consumption looks pretty good. Inflation is coming down. So you have this potential real income boost if the labor market stays relatively healthy that I think carries the U.S. in good stead relative to the rest of the world. So I think it's a continued short term short to medium term growing higher for the dollar. Is that Tim good morning. Is that dollar strength another tailwind for European equities as we look at that rotation. Yeah I think it can be. You know it's certainly on a relative basis they've underperformed the U.S. over the last couple of months. And I think that that can potentially help when you get a weaker currency against the dollar and being so sensitive to it. Yeah. And in terms of the rotation then where do we look in Europe to benefit from that. I mean part of the rotation maybe is into Europe and away from some of the U.S. and heavily played tech names in Asia. So maybe Europe just as a whole continues to benefit. We saw that a bit last week . Is it banks. Is it more cyclicals. What do we what do we think. The cyclical story I 'm a little less confident on just on kind of the dynamics with energy prices lately and…From: this video · 4 claims mined from it

…strengthen from really some very weak levels. It is one of the most undervalued currencies in our metrics. I think it's quite the contrast between the strength in the equity markets and the weakness of the one. I think it's not dissimilar to some extent to what is happening with the yen. I think the one has been trading more and more like the yen over the years and I think that that feature of it is probably not going away anytime soon. But in the short term I think some of these flows should be more supportive for the one and it has been trading on a better footing over the last couple of weeks already. 1.62 dollar yen this morning. 1.65 coming. How quickly do we get from A to B. Our forecast is that it's going to take a while to get there. We have it in you know about 12 months 1.65. So you know there is there's some time and I think part of that is if it was just up to the macro influences it was just up to you know freely what is going on the impulses in global markets. I think you'd get there quicker. We do have to take into account that periodically you're going to see pushback from the Japanese policy authorities you're going to see interventions. What does that do. In my view what it does is it resets the level every time they do the intervention. It kind of dampens volatility but it doesn't change the broader trends. You get there as if the macro conditions persist if we have no recession risk if the Japanese policy authorities are not super hawkish. But I think it's going to take a while.…From: this video · 4 claims mined from it