Bond and cyclical trades best for currencies

The bank’s study into the performance of currency trading strategies under various macro environments, found that during a Fed pause the two strategies tend to outperform G10 carry trades.

“The natural instinct is to emphasise carry styles during a Fed pause, given the high correlation between rates, carry models and currency fund manager performance. Stable rates are a positive for industry performance,” said John Normand, global currency, commodity and fixed-income strategist at the bank in

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