A trading theme has dominated the FX market lately: growth is rewarded. Canada, Norway and Sweden, which have shown the biggest improvement in Citigroup's economic surprise indexes among major economies over the past three months, have also seen their currencies rally the most.
Based on this measure, the dollar looks oversold against the NZD, EUR, GBP, JPY and CNY. While the U.S. data have beaten economists' forecasts lately, the DXY index is down more than 4% over the past three months. A continued improvement in data could see the greenback claw back some lost ground.
Source: Bloomberg Pro Terminal
Trader - S. Fuchedzhiev
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