Fed at Zero Bound to Push Dollar-Yen to 90, RBC’s Lignos Says

The video discusses the current state of currency movements, particularly focusing on the dollar yen. It highlights the potential impact of US rate cuts on the dollar yen, predicting a stabilization closer to 90 if US yields move towards the zero lower bound. The video also covers the implications of hedging flows from Japanese investors and the importance of market timing in currency trading.

What is the current state of currency movements according to the video?

• They are unpredictable.

• They are relatively well contained.

• They are declining rapidly.

• They are highly volatile.

What is the expected impact of US rate cuts on the dollar-yen exchange rate?

• The exchange rate will decrease.

• The exchange rate will fluctuate unpredictably.

• The exchange rate will remain stable.

• The exchange rate will increase significantly.

What level is suggested for the dollar-yen exchange rate to stabilize at?

• Around 100

• Below 80

• Above 110

• Closer to 90

What is the anticipated effect of US yields moving towards the zero lower bound?

• A significant wave of hedging flows from Japanese investors.

• Stability in the currency market.

• A decrease in hedging flows.

• Increased investment in US bonds.

What is expected to happen as hedging costs decrease?

• Stability in the dollar-yen exchange rate.

• An increase in dollar-yen buying.

• A decrease in currency market activity.

• A rise in dollar-yen selling flows.