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A ceasefire has been established, leading to a sharp decline in oil prices and expectations of a weaker Dollar. Robin Brooks, commenting on these market movements, said emerging market currencies are now poised for significant gains, with Brazil’s Real identified as the top beneficiary.
Brooks had previously indicated anticipation of a ceasefire and now highlights how the shift affects global markets, especially for EM currencies.
Brooks previously remarked on market reactions during the conflict, noting that the S&P 500 and U.S. dollar showed limited movement as hedging activity increased in oil and private credit markets during the escalation. He also observed India's decision to sharply reduce Gulf oil imports in favor of Iranian and Russian supplies amid shifting crude sources. These developments reflect his ongoing focus on oil flows and currency markets.