We remain bearish on the USD as it looks stretched as per our model which tracks key macro drivers. 

We continue to anticipate a USD correction in the coming weeks. This would require a catalyst – either in the form of geopolitical risks abating or US data slowing.

We remain bullish high quality carry currencies (MXN, BRL, INR). We also like CAD where the BoC has the potential to out-hawk its peers given underlying inflation momentum. We also favor China proxies like AUD, NZD from continued policy easing and signs that activity data has bottomed out.