Interesting chart which we suspected and all knew that, thus far, the 2013 macro equity trade x/ U.S. has been to be long those markets where the home currency is weakening against the dollar. The red regression line illustrates this relationship though it is far from a perfect fit.
Interesting to note Australia’s stock market, one of the best performers in 2013, began its latest leg as the currency peaked against the dollar on January 10th.
Brazilian equities have been the real dog this year as it appears the government will allow the currency to appreciate to dampen inflation.
(click here if charts are not observable)