Answer: Negative

## Explanation Since the 2007-2009 financial crisis, the cross-currency basis for most major currencies relative to the U.S. dollar (USD) has consistently been **negative**. **Key Reasons:** - **USD funding premium**: Global demand for USD funding has created persistent pressure - **Regulatory changes**: Post-crisis regulations increased the cost of USD funding for non-US banks - **Safe-haven status**: USD's role as a global reserve currency creates structural demand - **Basis swap mechanics**: Negative basis means foreign currency borrowers pay a premium to access USD **Market Impact:** - EUR/USD and JPY/USD basis have been consistently negative - Reflects the structural imbalance in global USD funding markets - Has implications for multinational corporations, financial institutions, and arbitrage strategies This persistent negative basis represents a breakdown of traditional covered interest parity that has become the "new normal" in post-crisis markets.

Author: LeetQuiz .