Carry carried out

The latest down-move on the Aussie overnight has highlighted the increased deterioration we’ve seen in carry currencies in the past 2-3 weeks, enhancing the underlying trend seen since April. AUD/JPY best reflects this, with the key carry cross now threatening to break below the 72.20 low marked out in 2010. Taking a wider look at the carry trade, it’s notable just how badly it is now performing, even though we are living in a world with zero interest rates in several major currencies and plenty of carry opportunities beyond those shores.
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04/10/2011 @ 10:23 GMT