Valuation to limit the US dollar’s upside – ING

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Dec 3, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    FXStreet (Delhi) – Research Team at ING, suggests that the main reason they are not more bullish on the USD in 2016 is the valuation constraint.

    Key Quotes

    “Based on our medium-term BEER valuation model, the real USD is some 8% overvalued relative to medium fundamentals. We see the USD upside as most limited against Europe and Japan, with the most likely surprise coming in USD/Asia should the PBOC allow a larger depreciation of the CNY in the face of stronger US rates.”

    “One final remark for 2016. November sees US Presidential elections. Democratic Administrations have generally been associated with a stronger dollar. Major US corporate tax reform in 2017 would probably be the main risk to our bearish USD view.”
    For more information, read our latest forex news.

Share This Page

free forex signals