In the recent period, the Chinese renminbi and the Japanese yen have appreciated against the euro and the dollar. Economists at Natixis believe that these two currencies will continue to appreciate.
Key quotes
“China and Japan have managed the COVID-19 pandemic much better than the United States or Europe and are therefore enjoying a stronger economic recovery. This stronger recovery is attracting capital flows to China and Japan.”
“The economic outlook is deteriorating again for the United States and the eurozone due to the second COVID-19 wave.”
“The United States is a concern due to its accumulation of external debt, its savings shortfall and the deterioration in its long-term growth prospects related to the declining employability of its population. So it is likely there will be less non-resident demand for US assets.”