Investors should continue to sell the U.S. dollar to look for more attractive returns in emerging markets, in the absence of agreement between leaders of major powers this weekend to try to ease tensions related to changes in currency .
Markets remain on the lookout for a new operation in Japan, which sold the yen in mid-September for the first time in six years to stem the appreciation of its currency.
The prospect of a further easing of U.S. monetary policy, already highly accommodative, brought down the dollar to its lowest level in eight and a half months, diverting capital to emerging markets more lucrative.
In an attempt to curb this movement, reflected by the continued appreciation of their currencies, many emerging countries like Brazil, have adopted measures that maintain the fear of a "war of currencies".
Talks were held this weekend in Washington, where there was a general meeting of the International Monetary Fund (IMF), yielded only a loose agreement of closer monitoring of economic policies.And no concrete steps have been taken.
For analysts, the Fed now has free rein to decide next month for new measures to relax its policy by injecting additional funds into the economy, which would amplify the decline in the dollar .
"Overall, despite the occasional reference to the strong dollar policy, which seems increasingly anachronistic, there is little to suggest that the dollar could do anything but fall," says Steven Englander director of currency strategy at Citigroup.
For technical strategists, the euro will probably remain above $ 1.35 in the medium term, especially because the European Central Bank (ECB) is expected to begin raising rates before the Fed.
Speculation about the YEN STILL RISKY
Meanwhile, the contention between great powers on the file exchange is clear: Brazil doubled last week the taxation of foreign capital invested in the bond market, South Korea has warned that it intended to regulate certain financial transactions and India has hinted it might intervene in currency markets.
China, it has reiterated in recent days it intended to take his movement rate of appreciation of its currency, the yuan.
For Alan Ruskin, head of G10 foreign exchange strategy at Deutsche Bank, the current exchange rate is the logical consequence of divergent economic developments.
"This goes far beyond the mere fact that the Fed prepares to launch new quantitative easing", he said.
"We are faced with interest rates low for some time in most developed economies, with strong growth and the need to toughen policies elsewhere.This implies that flows to the emerging world will continue. "
Specifically on the yen, some investors may test the resolution of the Bank of Japan in pushing the dollar to a new record low, but speculate on the Japanese currency remains risky, analysts say.
Some note that the silence of the United States this weekend on the issue could be a tacit green light to further intervention by Tokyo.The dollar was changing Friday under the threshold at which the Japanese authorities intervened in the market on September 15.
"Geithner was flexible enough for the Japanese so there are probably people who are afraid to see the BOJ intervene again," said Marc Chandler, strategist at Brown Brothers Harriman, in reference to U.S. Treasury Secretary Timothy Geithner.
Alan Ruskin, Japan visibly free hand for now as it attempts to slow the yen's rapid appreciation, rather than targeting a specific level, as some emerging countries.
"I think that the United States seeks to prevent Japan diverts attention from efforts to achieve greater flexibility of the Chinese Foreign Exchange," he says.