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Citi flags a risk of a sharp rise in net US dollar demand into year-end, which could lift USD liquidity premiums and spike the dollar. The warning follows a period when dollar liquidity premiums had been shrinking.
A year-end dollar spike would strengthen the dollar and pressure dollar-priced grain, meal and oilseed export values, while emerging-market currencies weaken and raise import costs.
forexcrunch.comYohay ElamDec 4, 2019After 2,356 past bullish macro events, US Dollar (Broad) moved a median +0.2% over 5 sessions (60% higher; middle half -0.3% to +0.7%), and +0.4% over 20.
After 301 past bearish macro events, Corn moved a median -0.1% over 5 sessions (47% higher; middle half -2.2% to +1.3%), and +0.2% over 20.
After 273 past bearish macro events, Soybeans moved a median -0.4% over 5 sessions (44% higher; middle half -2.4% to +1.4%), and -0.5% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
