October 2018 – IN BRIEF

What happened
  • Per the Bloomberg Dollar Spot Index, the greenback finished almost even in September
  • Consistency in economic performance and a Fed hike boosted the dollar as month closed
  • NAFTA got a makeover that boosted Mexican Peso and Canadian Dollar by 1.9% on avg.
  • Improved trade, record equities, and 0.5% rise in MSCI Emerging FX sank JPY and CHF
  • Italy became a clear problem for the Euro-zone with disagreement over fiscal spending
  • Theresa May survived attacks from her own political party and is working Brexit her way
Tempus’ view
  • Chinese trade drama will continue to play out, blurring clarity on U.S. Dollar’s direction
  • Euro will remain volatile as experts point to similarities between Italy and the Greek crisis
  • Now that NAFTA has been re-negotiated, MXN and CAD will flow with oil prices
  • Pound gained in September, but is still under pressure with Brexit deadline approaching
  • The buck will stay afloat as long as the divergence between the economic situations of the U.S. and the globe persists, which may favor the currency as a safe-haven
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