Re:As German Bund Yields Head to Zero, They Still Beat U.S. ...
by fauigerzigerk on Sunday February 10, 2019 @02:53AM
(#19126796)
Absolutely, but if an institution is taking some form of deposit in euros and promises to make predictable payments in euros then being long euros is not a directional bet for that institution.
Of course the picture gets a little murkier once you start considering inflation caused by exchange rate fluctuations. But that is probably not the main concern in a large currency area with an independent central bank.
Re:As German Bund Yields Head to Zero, They Still Beat U.S. ...
by cinquemb on Sunday February 10, 2019 @04:26AM
(#19127054)
We must have different ideas of what fx fluctuations are, +/-500 bps over a decade sure… not +/-500bps on -30% decline line over a decade vs a major pair…
Of course the picture gets a little murkier once you start considering inflation caused by exchange rate fluctuations. But that is probably not the main concern in a large currency area with an independent central bank.