On the heels of Abe's final decision to appoint a somewhat middle-of-the-road 'dove' as BoJ Governor, we thought it appropriate to look at the year's FX performance to see who is 'winning' the currency wars so far this year. The answer may surprise you (or not if you had read this or this).
GBP (blue) is the 'worst'-performing currency versus the USD this year - having overtaken the JPY in the last two days...higher on the chart below is USD strength
Interestingly, given US equity performance YTD, the USD is 2.25% stronger on the year against a broad basket of currencies.
The USD is 'seasonally' strong in Q1 on average over the past 30 years but this rise is quite remarkable relative to that average and we can only imagine what impact this will have on corporate earnings for Q1 as the S&P 500's 46% overseas revenues gets notched down on the income statement.
Charts: Bloomberg
