Analysts at Rabobank say that the vast majority of EM currencies benefited from Fed Chairman Powell’s dovish message during his testimony to Congress.

• “Led by the South African rand, the EM FX space appreciated against the US dollar after Powell cemented expectations for a rate cut later this month.
• We are not convinced that “the rally of everything” will prove sustainable as no amount of Fed easing will likely be sufficient to prevent global recession if trade tensions inevitably escalate again.
• However, we also fully acknowledge the powerful impact the prospect of easy money can have on risky assets over the short-term horizon and we have no intention to fight against it.”