King Dollar Dethroned From Safe-Haven Perch in Carry-Trade Shift
- Euro and yen outperform greenback in times of stress: BAML
- Funding markets see shift; dollar still ultimate reserve FX
Why UBS' Themistocleous Is Long on the Euro
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The euro and the yen have quietly usurped the dollar as the world’s favorite haven, according to Bank of America Corp. strategists.
Investors have been increasingly turning to the euro and yen to fund carry trades, leading to the greenback’s underperformance during bouts of risk aversion since 2014, currency strategists led by Adarsh Sinha said in a report Tuesday. Helping to supplant dollar dominance: the European Central Bank and Bank of Japan embarked on more aggressive monetary easing just as the Federal Reserve pared back stimulus.