Fiscal-powered US outperformance continues to dominate FX markets. Despite a market already long US assets, it’s difficult for investors to rotate away from the US (and the dollar) at a time when global trade volumes are slowing and US rates have yet to peak. Positioning and November US mid-terms are the biggest threat to the dollar right now, but overall we see the dollar holding gains into year-end. Italian politics are weighing on the EUR. There seems little incentive for the populists to make major concessions to Brussels right now. And while cheap and potentially receiving support from ECB policy into 2019, ... (full story)