This year will see an increase in demand for global currency overlay, particularly due to the depreciation of the U.S. dollar, according to bankers.
Paresh Upadhyaya, currency portfolio manager at Putnam Investments in Boston, said Asia is a more compelling region than the U.S. now because the currency outlook is more attractive. This is because local currencies are undervalued and several countries, such as China, Japan and Hong Kong, are experiencing strong domestic growth, in part due to a rise in commodities prices, he explained. Compared to the U.S., Europe also looks attractive because it has a smaller gross-domestic product deficit, Upadhyaya said.
