Standard Chartered's Englander on Currency Plays

Steve Englander discusses the breakdown of emerging markets (EM) and the lack of data recovery, highlighting the overestimation of market optimism. The China shock is noted as a factor affecting global growth, leading to risk aversion and a stronger yen. Currency pairs involving the yen are analyzed for their safe haven status. Current market strategies include long yen and short Korean positions, as well as a focus on Swiss-Canada trades due to commodity vulnerabilities.

What was the main concern regarding market optimism discussed in the first section?

• The market underestimated the potential for growth.

• The market was overly optimistic about global growth.

• The market ignored the potential of the Japanese yen.

• The market focused too much on the Swiss franc.

Why is the Japanese yen considered a safe haven currency?

• It is the least traded currency in the market.

• It is heavily influenced by the Canadian economy.

• It has consistently responded positively to negative shocks.

• It is the most volatile currency.

Which currency pair was highlighted as having potential for upside in the second section?

• Long Swiss Short Canada

• Long Yen Short Korean

• Long Euro Short Dollar

• Long Pound Short Yen

What is the main reason for considering a trade involving the Swiss franc and Canadian dollar?

• The Swiss franc is no longer a safe haven.

• The Canadian economy is expected to grow rapidly.

• The Canadian dollar is expected to strengthen significantly.

• The Swiss franc still retains some safe haven properties.

What factor makes Canada vulnerable according to the third section?

• The diminishing role of the Swiss franc.

• Its dependence on global commodity markets.

• The lack of rate cuts in the Canadian curve.

• Its strong reliance on the Japanese yen.