EFTA Document EFTA01436293

Subject: G10 Trade Idea of the week - Short USD/NOK From: Martin Zeman Date: Mon, 28 Jan 2019 10:50:04 -0500 To: "Paul Barrett ( Cc: Stewart Oldfield Further to my talking about NOK all the time.... From: Robin Winkler - Deutsche Bank [mailto:[email protected]] Sent: Monday, Januar 28, 2019 3:31 AM To: Martin Zeman Subject: G10 Trade Idea of the week - Short USD/NOK Deutsche Bank Research {Deutsche Bank Logo} G10 Trade Idea of the week Short USD/NOK EFTA01436293 28 January 2019 Robin Winkler Send email Shre as Go al Send email EFTA01436294 View report Target 8.25, entry 8.53, stop 8.65 Selling USD/NOK expresses two views: Norwegian macro outperformance and broad dollar weakness. On the former, Norway not only has stronger domestic growth momentum than most G10 economies but also happens to have trade exposure to economies that maintain relatively strong growth (Figure 1). This allowed Norges Bank last week to reiterate guidance for a hike in March, which is not yet fully priced. We expect Norges to be the only central bank in G10 to hike rates in the next three months. On the dollar, we see the broad dollar under continued pressure from various sources: low vol favouring EM carry, Chinese monetary easing perhaps obviating CNH depreciation, sentiment on the Euro bottoming out, Japanese investors still selling US equities, the Mueller investigation raising the political risk premium, and the trade war edging toward resolution. But it is hard to isolate the primary driver and beneficiary of dollar weakness, and we thus like selling USD/NOK as the dollar cross tracking the broad dollar most closely (Figure 2). Deutsche Bank Research I Manage Subscriptions I Unsubscribe You have received this email because you have subscribed to Robin Winkler. If you would like to make changes to your subscriptions, please click on the EFTA01436295 'Manage Subscriptions' link above. For more information, please contact your Deutsche Bank sales representative. Copyright 0 2019 Deutsche Bank AG, Frankfurt am Main This communication may contain confidential and/or privileged information. If you are not the intended recipient (or have received this communication in error) please notify the sender immediately and destroy this communication. Any unauthorized copying, disclosure or distribution of the material in this communication is strictly forbidden. Please refer to https://db.com/disclosures for additional EU corporate and regulatory disclosures. Deutsche Bank does not render legal or tax advice, and the information contained in this communication should not be regarded as such. EFTA01436296