The Forex portfolio continues to rise on the support of the long position in USDJPY and the short position in EURGBP. The year-to-date return is 83.5% and we expect that the market will temporarily take back some gains because it has moved significantly during the last five weeks.
USDJPY continues to be supported with news out of Japan that the sales tax hike will be postponed for at least another year and Abe ‘s announcement last Friday night after the market closed that the BOJ has been instructed to inject more liquidity during the next month.
EURGBP has been caught in a balancing area during the last few trading sessions. The recent move higher seems to have been caused by end-of-month rebalancing but price drop significantly last night after another Brexit phone pull was released showing that over 45% of participants wanted to stay in the EU while 41% wanted to leave.
AUDNZD has been rising and hopefully will continue higher as AUD strengthens versus the Kiwi. We feel the talk of parity is far from reality and that the New Zealand economy will start to show more signs of weakness in the near-term.