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Crédit Agricole: End-of-month flows may weigh on the dollar
Crédit Agricole estimates that rebalancing portfolio flows at the end of August could lead to some selling of the dollar, with the strongest negative signal appearing against the yen, at a time when banks’ forecasts differ regarding the direction of the U.S. currency.
The bank says global equity markets generally posted positive performance during August, while the dollar fell against most currencies over the month, which suggests limited dollar-selling flows when portfolios are rebalanced at month-end.
According to Crédit Agricole’s model, the strongest signal to sell the dollar is against the Japanese yen, while dollar sales are expected to be limited against other currencies.
These estimates come in contrast to Bank of America’s model, which points to limited inflows that support the dollar during the end-of-month period, reflecting differences in banks’ views on rebalancing flow direction.
However, Crédit Agricole stresses that these models do not represent certain forecasts for market moves, as end-of-month flows may increase price volatility and make some moves harder to interpret, though they remain a secondary factor compared with economic indicators and major events.#NYSilverFuturesDrop3% #SchwabPlansToAddSOLAVAXLINKTrading #USShortTermTreasuryYieldsJump #TrumpSaysUSReachedVenezuelaOilDeal #FedSeptRateHikeOddsRiseTo57%
$XAU
Crédit Agricole: End-of-month flows may weigh on the dollar
Crédit Agricole estimates that rebalancing portfolio flows at the end of August could lead to some selling of the dollar, with the strongest negative signal appearing against the yen, at a time when banks’ forecasts differ regarding the direction of the U.S. currency.
The bank says global equity markets generally posted positive performance during August, while the dollar fell against most currencies over the month, which suggests limited dollar-selling flows when portfolios are rebalanced at month-end.
According to Crédit Agricole’s model, the strongest signal to sell the dollar is against the Japanese yen, while dollar sales are expected to be limited against other currencies.
These estimates come in contrast to Bank of America’s model, which points to limited inflows that support the dollar during the end-of-month period, reflecting differences in banks’ views on rebalancing flow direction.
However, Crédit Agricole stresses that these models do not represent certain forecasts for market moves, as end-of-month flows may increase price volatility and make some moves harder to interpret, though they remain a secondary factor compared with economic indicators and major events.#NYSilverFuturesDrop3% #SchwabPlansToAddSOLAVAXLINKTrading #USShortTermTreasuryYieldsJump #TrumpSaysUSReachedVenezuelaOilDeal #FedSeptRateHikeOddsRiseTo57%
