The dollar may drop 11 percent versus the euro next year as investors shun U.S. assets and drive bonds lower, according to Citigroup Inc.
“It’s a bearish U.S. asset dynamic led by the bond market,” Tom Fitzpatrick, chief technical analyst, said in a telephone interview. “This period has a set-up that is amazingly like what we saw in the ‘70s, and is similar to what we saw around 1993.”
The dollar will follow trading patterns from the 1970s, when the housing market experienced a decline similar to the recent drop, and the 1990s, which also saw a slump in the bond market, technical analysts led by New York-based Fitzpatrick wrote in a note to clients. U.S. two-year yields doubled from a low of 3.7 percent in September 1993 to a high of 7.7 percent in December of 1994, pushing bond prices lower.
http://www.moneynews.com/StreetTalk/Citigroup-Dollar-Drop-2011/2010/12/15/id/380047?s=al&promo_code=B4DA-1
No comments:
Post a Comment