Hi Jeff! I was wondering if you have a view on where the USD is going this year or in the near future, say, Q1 and Q2? I am quite tempted to add some short-term US treasuries, but it's not my base currency, so I have to assess currency devaluation before adding positions that yield 4% per annum at best.
I suppose a stubborn labor market could lead them to over-hike or maintain a hawkish stance, but then, getting what they're after should favor that move into bonds that will make your long bond trade really shine. Thanks!
Yes, that BOJ interest rate ceiling expansion got me a bit jittery on whether the dollar can handle both a policy change by Kuroda (or his successor) and the ECB hawkish stance materializing into higher rates. That would pressure the dixie lower. Q4 saw a pretty sharp drop too... I think sideways is somewhat consensual.
I am also *very* interested in TLT. In fact, I might just open a small position here since I have none – that was a decent correction from 110, even if we go lower. The technicals are still clearly bearish, but at at these levels and given the multi-year deviation, it's a good hold for the right time horizon. Also, as you said, the bottom could potentially be in given recession expectations.
A bit random: have you looked at Mexican bonds? Strong currency, massive yield. It might be worth the risk/reward with low default risk.
Hi Jeff! I was wondering if you have a view on where the USD is going this year or in the near future, say, Q1 and Q2? I am quite tempted to add some short-term US treasuries, but it's not my base currency, so I have to assess currency devaluation before adding positions that yield 4% per annum at best.
I suppose a stubborn labor market could lead them to over-hike or maintain a hawkish stance, but then, getting what they're after should favor that move into bonds that will make your long bond trade really shine. Thanks!
Yes, that BOJ interest rate ceiling expansion got me a bit jittery on whether the dollar can handle both a policy change by Kuroda (or his successor) and the ECB hawkish stance materializing into higher rates. That would pressure the dixie lower. Q4 saw a pretty sharp drop too... I think sideways is somewhat consensual.
I am also *very* interested in TLT. In fact, I might just open a small position here since I have none – that was a decent correction from 110, even if we go lower. The technicals are still clearly bearish, but at at these levels and given the multi-year deviation, it's a good hold for the right time horizon. Also, as you said, the bottom could potentially be in given recession expectations.
A bit random: have you looked at Mexican bonds? Strong currency, massive yield. It might be worth the risk/reward with low default risk.