Deutsche Bank: If Warsh Avoids Signaling Policy Shifts, Carry Trade Opportunities Will Emerge

Odaily Planet Daily News George Saravelos, Global Head of FX Research at Deutsche Bank, stated that Fed Chair Kevin Warsh's goal is to "avoid expressing views on this year's monetary policy as much as possible, thereby minimizing the impact on market pricing." If Warsh can achieve this, the US dollar is likely to weaken, and "the path for summer carry trades will be fully open." In a report sent to clients on Wednesday, Deutsche Bank indicated that as the limited impact of the Iran war on markets fades, it is "difficult not to be bullish" on risk assets. The bank noted that global economic growth forecasts have barely changed since last year, and this resilient growth outlook is "not particularly a bullish signal for the US dollar." Deutsche Bank also believes that Europe has "the greatest potential" for upward revisions in growth expectations in the coming months.