This provides preliminary indication that FX markets have come to focus on debt and creditworthiness in addition to the standard macro variables. It suggests both potential upside for the EUR and other currencies that get their sovereign debt situation under control and significant downside for USD and JPY if markets ever begin to price in concrete risk that debt will become unsustainable.
Thursday, April 14, 2011
Citi Assessment of Impact of Debt Limit Impasse
Labels:
debt crisis,
debt default,
US Dollar,
USD