RBC benefits from carry trade view
CURRENCY FORECASTS
Monica Fan, RBC's London-based global head of currency strategy, said the bank's one-month currency forecasts were driven by the view that the wholesale unwinding of FX carry trades would be short-lived.
"Rumours of FX carry trades unwinding were triggered on February 27 by false reports of a capital gains tax on Chinese equities, as well as exaggerated fears that an explosion of subprime mortgage debt in the US would cause a recession," said Fan.
In March, the firm's proprietary Risk Aversion
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