Thought Leadership

Multicurrency Commentary 2nd Quarter 2009

July 17, 2009

Near the end of the 2nd quarter, warning signs began to appear that economic fundamentals were not keeping up with the market’s expectations for recovery.  Forward looking market indicators that signaled growth, such as corporate bond spreads, equity market performance, or commodity returns, began to stall or fade.  In this context, as we rebalanced our currency strategy at the start of the 3rd quarter in line with our new benchmark, the Federal Reserve Major’s Index, we moderated our growth tilt by pulling back Canadian exposures relative to the benchmark, and increased our safe haven allocation to yen and Swiss francs closer to neutral for the first time in many months.