FXStreet (Delhi) – Research Team at Nomura, suggests that the G10 FX is trading as if in recession at the moment but the fear of recession is still unlikely and sentiment may turn soon. Key Quotes “Global cyclical positions tend to have a different impact on each of the G10 currencies. The recent trading pattern in G10 FX – outperformance of G3 currencies, underperformance of commodity currencies, and GBP’s significant underperformance – is typically observed when the global economy is in a recession phase. The recent trading pattern is the closest we’ve seen to a recession pattern since the financial crisis. As investors gradually see a higher possibility of recession in major economies, their reaction may be unsurprising in the short term. However, our criteria show that even the global manufacturing cycle is not entering a recession phase, unlike during the financial crisis. The service sector has been performing more strongly, and a recession in major economies is not our central case scenario. The latest market movement appears to be excessive. As investor sentiment normalizes, we think depreciation pressures on GBP and commodity currencies and appreciation pressures on G3 currencies should ease.” For more information, read our latest forex news.