FxPro Financial Services Ltd

Executive Summary

• We did not start the year as secular dollar bulls but were still over-taken by the disappointing dollar performance, largely (but not wholly) down to the weaker US economy in Q1.
• Central banks have helped to create the historically low levels of volatility that pervade FX and other markets and need to do their bit to bring a little more uncertainty as tightening gets nearer.
• We were relatively correct in sterling and euro outlooks for H1, less so for yen and Aussie.
• Sterling should receive continued support from a likely Bank of England rate increase this year.
• The Aussie should remain relatively well supported in Q3, together with the euro.
• The yen is likely to weaken in the latter half of the year.