Policy divergence trade ideas - January EM/DM Leading Indicator Watch

New Ideas: Short SONIA vs SOFR DEC 24 (BOE policy regime more hawkish than Fed), short CNHINR (LEI divergence + carry).

Watching: GBP resilience, USDJPY 4 hourly LPPL bubbles, AUD Flatteners, AUDNZD, Banxico room to cut.

  • UK: Sonia vs SOFR, buy-the-dip on GBP
  • Canada: Bond rally tactically stretched, trim exposure; cyclical growth/inflation downside remains
  • Japan: BoJ still slow rolling policy normalization
  • Australia: Still feeling lucky (soft landing => RBA hawkish)
  • India: Strong growth LEI => hawkish bias for RBI, short CNHINR
  • Mexico: Room to cut => bullish bonds
  • Malaysia: Fuel exporter + strong FDI => equity tailwinds
  • Indonesia: Unwarranted outflows and cheap valuations
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