Currency Funds Slid in June on U.S. Economic Doubt, Parker SaysRachel Evans
Foreign-exchange funds lost 1 percent in June as reports cast doubt on the strength of the U.S. economic recovery, according to Parker Global Strategies LLC.
Of the 34 funds that reported results, 24 had losses, the company said in a statement today. Money managers’ performance ranged from losing as much as 7.1 percent to a return of 2.4 percent, the Stamford, Connecticut, company said in statement. The company’s index is down 4.4 percent for the past 12 months.
The dollar fell versus most of its major peers in June as revised report showed the U.S. economy shrank 2.1 percent in the first quarter, Parker said. The European Central Bank surprised investors by cutting interest rates to a record low. The 18-nation currency advanced 0.4 percent against its U.S. counterpart in June.
“Looking ahead, managers believe that the market is looking favorable for the U.S. dollar,” Parker said in the statement. The company also pointed to possible gains in emerging-market currencies “with stronger fundamentals as global economies recover and global volatility steadies.”
U.S. growth rebounded in the second quarter, with the economy expanding at a 4 percent annualized pace, according to numbers released this week. Employers added more than 200,000 jobs for a sixth consecutive month in July, according to the median forecast of 88 analysts surveyed before payrolls data are released tomorrow.
A gauge of the dollar added 1.9 percent this month, the most since May 2013, and touched a more than four-month high today. The U.S. currency has gained 2.2 percent against the euro this month and 1.5 percent versus the yen.
The Parker index includes 36 programs managing about $40 billion.