By Petr Krpata, Chief EMEA FX and IR Strategist
The US dollar is not as expensive and the pound is not as cheap as you might think. In trade-weighted terms, the dollar is not screamingly expensive in part due to the decline in fair value of the euro and sterling. EUR/USD screens as fairly valued while the cheapest G10 currency is the Swedish krona. The Swiss franc remains heavily overvalued vs. USD and EUR
To gauge the medium-term valuation for the G10 currencies, we employ our Behavioural Equilibrium Exchange Rate ((BEER)) valuation framework, where we