FX Snapshot

Major Currencies Performance

Last
Year-To-
Trading Weekly 1 month 1 month 1 month 3 month 3 month 3 month 52 week 52 week
CCY Date
Day Change high low change high low change high low
Change
Change
USD 92.58 0.6% 93.57 92.04 -0.6% 93.57 90.08 2.7% 94.74 89.21 2.8%
EUR/USD 1.1814 -0.6% 1.1880 1.1675 0.9% 1.2170 1.1675 -2.8% 1.2349 1.1603 -3.2%
USD/JPY 109.94 0.2% 110.57 109.24 -0.8% 111.53 109.04 0.4% 111.66 102.59 5.9%
GBP/USD 1.3839 -0.2% 1.3871 1.3623 0.0% 1.4177 1.3623 -2.4% 1.4248 1.2676 1.3%
USD/CAD 1.2692 1.3% 1.2828 1.2504 1.2% 1.2828 1.2096 4.7% 1.3421 1.2007 -0.5%
AUD/USD 0.7356 -1.4% 0.7460 0.7132 0.2% 0.7754 0.7132 -5.0% 0.8007 0.6991 -4.1%
NZD/USD 0.7113 -0.6% 0.7158 0.6835 1.4% 0.7202 0.6835 -1.3% 0.7465 0.6512 -1.0%
USD/CHF 0.9176 0.5% 0.9233 0.9113 -0.6% 0.9255 0.8945 2.5% 0.9473 0.8758 3.4%
USD/CNY 6.4443 -0.2% 6.5015 6.4443 -0.5% 6.5112 6.3932 1.0% 6.8395 6.3570 -1.1%
USD/CNH 6.4432 0.1% 6.5011 6.4386 -0.6% 6.5269 6.3862 1.0% 6.8462 6.3525 -0.8%
GOLD 1787.58 -2.2% 1827.73 1728.93 3.8% 1898.51 1728.93 -5.5% 1973.60 1676.89 -5.4%

Last Trading Day Change Technical levels Citi Forecasts

CCY Daily
Close Day High Day Low Sup2 Sup1 Res1 Res2 0-3M 6-12M LT
Change
USD 92.58 92.65 92.33 0.11% 90.40 91.35 93.19 94.65 91.12 93.46 93.47
EUR/USD 1.1814 1.1851 1.1810 -0.09% 1.1704 1.1805 1.1909 1.2006 1.20 1.16 1.15
USD/JPY 109.94 109.99 109.70 0.20% 107.48 108.72 110.70 111.71 108 112 112
GBP/USD 1.3839 1.3889 1.3827 0.01% 1.3572 1.3602 1.3983 1.4017 1.41 1.41 1.44
USD/CAD 1.2692 1.2695 1.2583 0.22% 1.2365 1.2422 1.2807 1.2949 1.26 1.23 1.18
AUD/USD 0.7356 0.7410 0.7349 -0.16% 0.7032 0.7290 0.7563 0.7610 0.75 0.73 0.76
NZD/USD 0.7113 0.7156 0.7090 0.11% 0.6756 0.6999 0.7315 0.7465 0.72 0.69 0.67
USD/CHF 0.9176 0.9185 0.9150 0.07% 0.8919 0.9019 0.9264 0.9500 0.91 0.96 0.99
USD/CNY 6.4443 6.4571 6.4367 -0.27% -- -- -- -- 6.40 6.30 5.60
USD/CNH 6.4432 6.4549 6.4261 -0.13% 6.4009 6.4118 6.4766 6.5002 -- -- --
GOLD 1787.58 1803.90 1787.28 -0.39% $1,671 $1,678 $1,834 $1,916 $1,750 $1,575 --

Source: Bloomberg L.P., as of Sep 10, 2021

(cut off time is NY Time 5:00pm)

*INVESTMENT PRODUCTS: NOT A BANK DEPOSIT. NOT GOVERNMENT

INSURED. NO BANK GUARANTEE. MAY LOSE VALUE
 FX Snapshot
Source: Bloomberg L.P.
Important Economic Data (Sep 13, 2021 – Sep 17, 2021) (K = Thousand, M = Million, B = Billion)

Perio
Time Event Actual Survey Prior
d
Monday
09/13/21 09:00 NZ ANZ Activity Outlook Sep -- -- 19.2
Tuesday
09/14/21 02:00 US Monthly Budget Statement Aug -- -- -$302.1b
09/14/21 09:30 AU NAB Business Conditions Aug -- -- 11
09/14/21 14:00 UK Average Weekly Earnings 3M/YoY Jul -- -- 8.80%
09/14/21 14:00 UK ILO Unemployment Rate 3Mths Jul -- -- 4.70%
09/14/21 20:30 US CPI YoY Aug -- 5.30% 5.40%
09/14/21 20:30 US CPI Ex Food and Energy YoY Aug -- 4.30% 4.30%
Wednesday
09/15/21 06:45 NZ BoP Current Account Balance NZD 2Q -- -- -2.895b
09/15/21 10:00 CH Retail Sales YoY Aug -- 7.00% 8.50%
09/15/21 10:00 CH Industrial Production YoY Aug -- 5.80% 6.40%
09/15/21 14:00 UK CPI YoY Aug -- -- 2.00%
09/15/21 20:30 CA CPI YoY Aug -- -- 3.70%
09/15/21 20:30 CA CPI Core- Common YoY% Aug -- -- 1.70%
Thursday
09/16/21 06:45 NZ GDP YoY 2Q -- -- 2.40%
09/16/21 09:30 AU Employment Change Aug -- -- 2.2k
09/16/21 09:30 AU Unemployment Rate Aug -- -- 4.60%
09/16/21 20:15 CA Housing Starts Aug -- -- 272.2k
09/16/21 20:30 US Retail Sales Advance MoM Aug -- -0.90% -1.10%
09/16/21 20:30 US Retail Sales Ex Auto MoM Aug -- -0.30% -0.40%
09/16/21 20:30 US Initial Jobless Claims Sep -- -- --
Friday
09/17/21 14:00 UK Retail Sales Inc Auto Fuel YoY Aug -- -- 2.40%
09/17/21 14:00 UK Retail Sales Ex Auto Fuel YoY Aug -- -- 1.80%
09/17/21 17:00 EC CPI YoY Aug -- -- 2.20%
09/17/21 22:00 US U. of Mich. Sentiment Sep -- 73.7 70.3
 FX Snapshot

Citi FX interest rate Forecast

9/10/2021 3Q ’21 4Q ’21 1Q ’22 2Q ’22

Dollar Index *0.00 0.00 0.00 0.00 0.00

EUR/USD -0.50 -0.50 -0.50 -0.50 -0.50

GBP/USD 0.10 0.10 0.10 0.10 0.10

USD/JPY -0.10 -0.10 -0.10 -0.10 -0.10

USD/CHF -0.75 -0.75 -0.75 -0.75 -0.75

AUD/USD 0.10 0.10 0.10 0.10 0.10

NZD/USD 0.25 0.25 0.50 -- --

USD/CAD 0.25 0.25 0.25 0.25 0.25

USD/CNY 2.95 2.95 2.95 2.95 2.95

Source: Citi (as of Aug 18, 2021)

*lower bound
#Rate hike expectations
 FX Snapshot

USD Citi views & strategy Bias/ Forecasts/ Key levels

Citi FX The weak August payrolls number came out • Previous month:
outlook below the lowest estimate within the • DXY: 6 – 12mth: 93.28
Bloomberg survey of economists, so it’s fair • DXY: LT: 93.47
to say that “substantial further progress”
was not made in August. This therefore • Currently (as of Sep):
pushes the Fed’s anticipated announcement • DXY: 6 – 12mth: 93.46
of a taper to the November FOMC, rather • DXY: LT: 93.47
than September. Near term, this may weigh
on the USD, particularly as the ECB has • MT Bias: Modestly bullish USD (ex GBP,
become less dovish at the margin, making AUD, CAD, CNH, SGD)
the Fed one of the G10 laggards to announce
a taper/ slowing of asset purchases. • DXY still rangebound but biased to
Over the next 6-12m we envisage a stronger head towards the lower end of the
USD. 91.28 – 93.44 range to year-end

EUR Citi views & strategy Bias/ Forecasts/ Key levels

Citi FX There are likely 2 factors which can support • Previously
outlook EUR over the near term. Firstly, in the past • EURUSD: 6 – 12mths: 1.16
2 weeks, the ECB has moved slightly less- • EURUSD: LT: 1.15
dovish/ more hawkish. The second factor
which can support the EUR in the near term • Currently (as of Sep):
is the fact that relative data momentum • EURUSD: 6 – 12mths: 1.16
differentials between Europe and the US • EURUSD: LT: 1.15
still point in favour of EUR. Going forward,
we expect EUR/USD to fall to 1.16 as the US • MT Bias: Moderately bearish EUR (ex
once again becomes economically CHF, NZD); Neutral EUR vs JPY
exceptional into 2022, supported by further
fiscal impulse. Meanwhile, • Tactically neutral EUR vs USD;
the Euro Area economy may be at risk of Tactically moderately bearish EUR vs
continued weakness to the Chinese risk/ high beta FX (Commodity FX -
slowdown. In terms of monetary policy, the AUD, NZD, CAD), GBP and Asia EMFX
Fed will likely to hike rates at the end of (CNH and SGD)
2022. The ECB is unlikely to hike rates over
the next 12-18 months.
 FX Snapshot

GBP Citi views & strategy Bias/ Forecasts/ Key levels

Citi FX Despite high levels of Covid cases in the UK, • Previously
outlook hospitalizations remain more subdued. • GBPUSD: 6 – 12mths: 1.41
Given this superior vaccine rollout, we don’t • GBPUSD: LT: 1.44
think the Delta variant poses a risk to a
lower GBP. If anything, the ‘Covid • Currently (as of Sep):
exceptionalism’ tailwind for GBP should • GBPUSD: 6 – 12mths: 1.41
continue. In our view, UK assets remain • GBPUSD: LT: 1.44
attractive from both valuation and post-
COVID economic normalisation angles. On • MT Bias: Bullish GBP vs USD, EUR
the former, UK equities are historically
cheap both absolute and relative (to • Tactically bullish GBP vs USD, JPY,
government bonds and to other CHF, EUR and AUD
international equity markets). Sterling
remains cheap.

JPY Citi views & strategy Bias/ Forecasts/ Key levels

Citi FX Japan’s lagged response to the vaccine • Previously
outlook rollout, and outgoing PM Suga’s zero-COVID • USDJPY: 6 – 12 months: 112.0
policy have arguably weighed on the • USDJPY: Longer term: 112.0
Japanese macro-backdrop and JPY over the
past 2 quarters. Additionally, soaring • Currently (as of Sep):
commodity prices have supported USDJPY, • USDJPY: 6 – 12 months: 112.0
with Japan being one of the world’s largest • USDJPY: Longer term: 112.0
commodity importers. Going forward, crude
oil > $70 can continue to be a drag to • MT Bias: Moderately bearish JPY vs
Japan’s terms of trade and thus weigh on USD; Neutral vs EUR
Yen.
• Tactically bullish JPY vs USD and EUR;
Tactically bearish JPY vs AUD
 FX Snapshot

CHF Citi views & strategy Bias/ Forecasts/ Key levels

Citi FX In the next 6-12m, the beginning of policy • Previously
outlook normalization in the US and a slightly less • USDCHF: 6 – 12mths: 0.97
dovish ECB would put upwards pressure on • USDCHF: LT: 0.99
EURCHF and USDCHF. The Swiss Franc’s
negative correlation to 10y UST & 10y Bunds • Currently (as of Sep):
has been strengthening further, Citi expects • USDCHF: 6 – 12mths: 0.96
the SNB to remain a laggard in monetary • USDCHF: LT: 0.99
policy normalization amongst its CB
counterparts. • MT Bias: Bearish CHF vs USD & EUR

• Tactically bearish CHF vs Commodity

FX (AUD, NZD & CAD), Asia EMFX (CNH
& SGD) and GBP

AUD Citi views & strategy Bias/ Forecasts/ Key levels

Citi FX The biggest uncertainty for AUD over our • Previously
outlook forecast horizon is COVID: lockdowns • AUDUSD: 6 – 12mths: 0.78
persist in a number of states, causing • AUDUSD: LT: 0.76
further damage to the economy. AUD will • Currently (as of Sep):
also likely be weighed down by moderating • AUDUSD: 6 – 12mths: 0.73
commodity prices and slowing economic • AUDUSD: LT: 0.76
activity in China in 6-12 months; Citi’s expect
growth in China to moderate from 8.7% in • MT Bias: Neutral AUD vs USD;
2021 to 5.5% in 2022. Moderately bullish AUD vs EUR and
NZD

• Tactically bullish AUD vs USD, EUR,

JPY and CHF; Tactically bearish AUD
vs NZD, CAD, GBP and SGD
 FX Snapshot

NZD Citi views & strategy Bias/ Forecasts/ Key levels

Citi FX Recent news that NZ will lift their lockdown • Previously
outlook (bar Auckland) is no doubt a positive for • NZDUSD: 6 – 12 months: 0.69
NZD in the short term, which will likely be • NZDUSD: Longer term: 0.69
further helped by a hike from the RBNZ at
their October meeting as RBNZ • Currently (as of Sep):
communicates it is ready to hike, given a • NZDUSD: 6 – 12 months: 0.69
tight labor market, strong core inflation, • NZDUSD: Longer term: 0.67
rising inflation expectations and a desire to
move away form extremely low rates. Risks • MT Bias: Modestly bearish NZD vs USD,
to growth in the medium term, come in the EUR and AUD
form of moderating commodity prices,
Australia’s continued lockdowns, and the • Tactically bullish NZD vs USD, EUR,
ongoing economic slowdown in China. JPY, CHF, AUD and CAD

CAD Citi views & strategy Bias/ Forecasts/ Key levels

Citi FX In the near term, CAD faces a number of • Previously
outlook headwinds. Economic data momentum has • USDCAD: 6 – 12mth: 1.20
turned negative. Softening incoming data • USDCAD: LT: 1.18
combined with an impending election (20
September) means that BoC messaging is • Currently (as of Sep):
likely neutral in the near term. However, for • USDCAD: 6 – 12mth: 1.23
our medium term view, given Canada’s high • USDCAD: LT: 1.18
vaccination rate, more lockdowns seem very
unlikely and the economic data should come • MT Bias: Bullish CAD vs USD and EUR
in more strongly as we shift away from 2Q
prints. Canada will also likely see more fiscal • Tactically bullish CAD vs USD, EUR,
post-election. JPY and CHF
 FX Snapshot

CNH Citi views & strategy Bias/ Forecasts/ Key levels

Citi FX USDCNH may turn lower once again • Previously
outlook especially with a more supportive backdrop • USDCNH: 6 – 12 months: 6.30
for risk FX following a likely Fed taper delay. • USDCNH: Longer term: 5.60
While the RMB is still well supported in the
recent market turmoil, we would like to flag • Currently (as of Sep):
that the downside risks on the RMB have • USDCNH: 6 – 12 months: 6.30
risen, especially if the current regulatory • USDCNH: Longer term: 5.60
uncertainty were to continue and the Fed
were to taper faster than expected. • MT Bias: Bullish CNH vs USD and EUR

• Tactically bullish CNH vs USD, EUR,

JPY, CHF
 FX Snapshot
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Important Disclosure on High Yield Bonds

Unrated or non investment grade Debt Securities typically offer a higher yield than investment grade Debt Securities, but also present greater risks with respect to liquidity, volatility,
and non-payment of principal and interest. As a result of being classified as non investment grade Debt Securities, these Debt Securities present a greater degree of credit risk
relative to many other fixed income Debt Securities.
Higher Credit Risk – Unrated or non investment grade Debt Securities generally have predominantly speculative characteristics with respect to the issuer’s capacity to pay interest
and repay principal. There is greater risk of non-payment of interest and loss of principal. Many issuers of these Debt Securities have experienced substantial difficulties in servicing
their debt obligations, which has led to default and restructurings. The issuers of these Debt Securities generally have to pay a higher rate of interest than investment grade Debt
Securities.
Higher Liquidity and Secondary Market Risk – The markets in which unrated or non investment grade Debt Securities are traded are generally more limited than those in which
investment grade Debt Securities are traded. This lack of liquidity may make it more difficult to resell these Debt Securities and obtain market quotations.
Downgrade Risk – Downgrades in the credit rating of unrated or non investment grade Debt Securities by rating agencies are generally accompanied by declines in the market value
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become more risk averse; and iii) default risk rises. This is often referred to a “flight to quality”.
Event Risk – This includes any of a variety of events that can adversely affect the issuer of unrated or non investment grade Debt Securities, and therefore the issuer’s ability to meet
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generally upon the overall economy. It could have a direct or indirect impact on the issuer and their outstanding debts.

Important Disclosure on RMB

Risk relating to RMB – If you choose RMB as the base currency or the alternate currency, you should also note the following:
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