FXstreet.com (Barcelona) - According to Nomura, when a local market closes for holidays, the local currency tends to appreciate against the USD: “We find that generally during local market holidays, local currencies appreciate against USD,” say analysts at the bank, while, “During US-only holidays, the USD tends to appreciate against other currencies,” they note.

“One hypothesis that can explain this behaviour is that during market holidays outflows related to investments into foreign markets are curtailed,” Nomura suggests, “Hence, an absence of these flows results in appreciation of the local currency,” they conclude.