G-20 Presents Risks for Commodity-Currency Rally, RBC Says

By Daniel Tilles

Sept. 24 (Bloomberg) -- The Group of 20 meeting starting today poses risks for further gains by commodity currencies, according to RBC Capital Markets.

“Beware also of any toughened stance from the authorities on tackling financial-market speculation on commodities and oil in particular,” Sue Trinh, a senior currency strategist in Sydney, wrote today in a report. “Further discussion on placing position limits on speculative positions could stop the current commodity-price rally in its tracks, with bearish consequences for commodity-leveraged currencies such as the Australian dollar and Canadian dollar.”

The euro may weaken as the G-20 starts, RBC also said.

“Following reports that France was worried about the euro’s strength yesterday, the euro may be on the defensive into the G-20,” Trinh wrote.

To contact the reporter on this story: Daniel Tilles in London at dtilles@bloomberg.net