EM, commodity basket weak as Trump boosts USD flows — #SaxoStrats
Investors are realising here, two days after Trump won the US presidential election, that his administration will likely be a massive upside driver for USD and we are now witnessing the ramifications in emerging market assets and commodity markets (most notably in copper which smells of an unsustainable rally driven by Chinese activity).
EMB:arcx weekly share price
Management and risk description
The biggest risk here if we get central bank intervention stopping the FX flows currently ripping EM assets apart. Worse than expected US macro or no Fed rate hike in December would also hurt our basket trade
Five-year weekly barchart on EWZ:arcx, EWW:arcx and GLEN:lon
Create your own charts with SaxoTraderGO click here to learn moreSource: Saxo Bank
sell at market Brazilian equities (EWZ:arcx)
Time horizon: medium-term but obviously very dependent on the longevity of USD strengthening.
— Edited by Michael McKenna