Some of the emerging market currencies used the recent USD hesitation and have started to appreciate. This phenomenon is not however affecting the Central and Easter Europe EM currencies. ZAR, MXN and TRY are gaining about 0.7-0.9% against the US dollar today while PLN and HUF are still struggling to stay at least neutral vs. USD.
Three EM currencies are gaining against the dollar today, the move has taken USDMXN below the trough from the final day of November; source: xStation5
While Donald Trump’s victory was broadly seen as EM fx negative (due to being a threat to open trade and likely to cause capital repqatriation flows) the market may still be open to considering the scale of their sell-off with the current state of knowledge on president-elect’s plans and what he will be able to pass through the Congress.
The USD is now starting to also yield to G-10 currencies, not only to the 3 mentioned EM currencies.
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