At the moment, the key theme in currencies is an improvement in risk sentiment and an appreciation in high-risk currencies, at the expense of lower-risk ones, such as the US dollar. The USD index has hit a June 2022 low and has fallen more than 10% since October, as the Federal Reserve slows its hiking cycle and global recession fears abate. Among the better performers, currencies closely linked to China have been doing well. In the G10, the Australian dollar has been doing particularly well. Among emerging market currencies, some Asian currencies, notably the Thai baht, have seen a strong performance. The Brazilian real and Chilean peso in Latin America, which rely heavily on China's demand, are also outperforming. Later in this podcast, we will delve into China's reopening and examine the winners and losers of that development.
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