UBS’s Gordon on Central Banks, Currencies

The video discusses the anticipated rate cuts by central banks like the Fed, RBNZ, and RBA, and their implications on global currencies. It highlights the weakening of the US dollar and forecasts for the Kiwi and Aussie dollars. The carry trade dynamics are explained, showing how traders benefit from holding certain currencies. The video also touches on the concept of a currency war and the challenges central banks face with limited room for conventional monetary policy, leading to discussions on unconventional measures like QE.

What is the expected rate cut by the Fed in July according to the UBS view?

• 100 basis points

• 75 basis points

• 50 basis points

• 25 basis points

What is the forecasted value for the Kiwi dollar according to the transcript?

• 0.65

• 0.60

• 0.55

• 0.70

Why are traders engaging in carry trade with the US dollar against the New Zealand and Australian dollars?

• Lower interest rates in the US

• Higher interest rates in the US

• Higher interest rates in Australia

• Higher interest rates in New Zealand

What domestic issues are causing central banks in New Zealand and Australia to cut rates?

• Increasing exports

• Strengthening labor markets

• Moderating housing markets

• Rising inflation

What unconventional policy measure is being considered by the RBA?

• Negative interest rates

• Quantitative easing

• Increased government spending

• Currency devaluation