We think high-beta DM currencies face near-term headwinds

We expect “high-beta” developed market currencies to weaken against the dollar over the coming months as risk sentiment worsens and, in some cases, yield gaps move against them. But we anticipate a rebound in appetite for risk later this year and ultimately expect high-beta currencies to appreciate over the rest of 2023. In particular, we think the Norwegian krone and the Swedish krona may outperform.

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