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Pressure ahead for commodity currencies – Rabobank

FXStreet (Córdoba) - According to Jane Foley, Senior FX Strategist at Rabobank despite the recovery that commodity currencies experienced during the last days, pressure ahead is seen.

Key Quotes:

“While we acknowledge that there has been some brighter news for some of the commodity currencies, the headwinds remain plentiful. We expect that weak demand will remain a constraint on commodity prices and on commodity currencies going forward.”

“We remain unconvinced that commodity currencies have turned the corner and we are viewing this week’s movement as a short squeeze. This year’s downside pressure on prices can be linked with supply gluts in a range of commodities including oil, iron ore, coal and diary. These gluts are in part a function of over-optimistic estimates of demand.”

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