Insights

On the back of solid US economic fundamentals, bets for rapid-fire rate increases by the Fed and the deteriorating outlook for growth in other major economies, the US dollar rallied strongly in April.

Neither the euro nor the British pound performed well in this environment. The euro came under pressure after the ECB signalled it wouldn’t accelerate its tightening plans, whereas sterling got dragged down by the instability in equity markets. But the real casualty was the yen, which got crushed by widening rate differentials as the Bank of Japan refused to play the normalization game.

Gold did not escape unscathed either. The yellow metal erased some early gains to close the month lower, as the combined forces of rising real yields and the strengthening dollar finally eclipsed safe-haven demand.

The IXI Fund had mixed results during this period and overall employed decreased leverage in its positions as a result of diverging algorithm signals. Early month losses were mostly recovered during the second half of April, leaving the NAV quite flat.