To fund or not to fund?

Yen still king as funding currency, but bonds trump FX carry


After the European Central Bank (ECB) implemented negative deposit rates in the eurozone last month, the euro emerged as a potential alternative funding currency to the yen for carry trades – a strategy that was hugely popular before the financial crisis and is coming to the fore once again as a potentially winning formula.

But, with volatility lingering near historic lows and interest rates in major economies stagnating around zero, strategists are divided on whether carry trades could make a

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