Currency Outlook

DECEMBER 2019 – IN BRIEF

What Happened

  • Buck played safe-haven role, improving by 1.2% in Nov. per the Bloomberg Dollar Spot Index
  • Additional tariffs are back in play as no Phase One deal ever materialized with China
  • Petro-currencies and other commodity-based tender suffered most losing over 1.0% on avg.
  • The Euro did not continue its upward run, declining instead by 1.3% although the European Union is set to add spending budget
  • Latin-American currencies such as MXN and BRL, were biggest losers facing regional chaos
  • Economic data revealed a slowdown across domestic as well as global markets

Tempus’ View

  • Elections in the U.K. could go one way or the other, but Sterling shall rise regardless as both sides promise to end Brexit dilemma
  • The Fed will likely stay away from moving interest rates as it meets on Dec. 11th
  • We keep faith in Euro rising along with prospects for recovery and growth
  • Tariffs set to be implemented by the U.S. on Chinese goods on Dec. 15th could be delayed
  • It is unclear at this point how much time it will take for a trade agreement to come to fruition, but we might have to wait until U.S. elections

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