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USD, EUR, JPY, GBP, CHF, AUD, NZD: Weekly Outlook - Morgan Stanley
USD: The Split USD. Neutral. US data has continued to come in on the strong side, supporting our argument that the US output gap is closed and inflation should pick up. However, US real yields have remained muted, helping financial conditions stay loose and risk appetite stay supported, creating a sweet spot for EM. While the markets await further details on Trump's tax plans in the coming weeks, we expect the USD to continue underperforming high yield EM and outperforming the low yielders. EUR: Looking Vulnerable. Bearish. Eurozone political concerns have taken a breather for now, but the EUR has become negatively ... (full story)