The Outlook for Currency in 2019

Use short-term moves to hedge long-term currency exposures

While 2019 may initially provide more of the same for international currency markets, the potential for a significant shift should not be discounted.

Toward the second half of 2019, markets may begin to anticipate that US exceptionalism has run its course as pressures on other regions dissipate.

Short-term currency moves in 2019 could provide opportunities for strategic investors to adjust their hedge ratios in anticipation that currencies will revert to fair value over the medium term.

Key takeaways:

  • US dollar strength is expected to persist into 2019
  • Euro and sterling are beset by European uncertainty and Brexit
  • The potential exists for a step change in the second half of the year
  • Consider increasing hedges on overvalued currencies
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More on the 2019 Global Market Outlook

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