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Win Thin

Win Thin

Win Thin is a senior currency strategist with over fifteen years of investment experience. He has a broad international background with a special interest in developing markets. Prior to joining BBH in June 2007, he founded Mandalay Advisors, an independent research firm that provided sovereign emerging market analysis to institutional investors. He received an MA from Georgetown University in 1985 and a B.A. from Brandeis University 1983. Feel free to contact the Zurich office of BBH

Articles by Win Thin

DM Equity Allocation Model For Q1 2020

4 days ago

Developed equity markets remain near the highs despite mounting concerns about the impact of the coronavirus
MSCI World made a new all-time high last week near 2435 and is up 2.5% YTD
Our 1-rated grouping (outperformers) for Q1 2020 consists of Ireland, Israel, New Zealand, Spain, and Switzerland
Our 5-rated grouping (underperformers) for Q1 2020 consists of the Italy, Germany, Portugal, Japan, and Greece
Since our last update on November 19, our proprietary DM equity portfolio has risen 6.9%, outperforming MSCI World (up 5.7%)
DM EQUITY OUTLOOK
Developed equity markets remain near the highs despite mounting concerns about the impact of the coronavirus. Things have turned 180 degrees since the year began, when the signing of the Phase One trade deal was expected

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Dollar Firm as Risk-Off Sentiment Picks Up Again

5 days ago

Negative news on the coronavirus has kept risk appetite subdued across the board; the dollar rally continues
During the North American session, we will get some more clues to the state of the US economy; FOMC minutes were largely as expected
UK January retail sales came in firm; ECB releases the account of its January 23 meeting
Australia reported firm January jobs data; China commercial banks cut lending rates; Indonesia cut rates 25 bp to 4.75%, as expected
The dollar is broadly firmer against the majors as risk-off sentiment picks up again.  Swissie and euro are outperforming, while yen and the Antipodeans are underperforming.  EM currencies are broadly weaker.  PHP and INR are outperforming, while THB and KRW are underperforming.  MSCI Asia Pacific was down

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Drivers for the Week Ahead

8 days ago

We get the first February data from the US manufacturing sector this week; the US economy remains strong; FOMC minutes will be released Wednesday
Canada reports some key data this week
Preliminary eurozone February PMI readings will be reported Friday; UK has a busy data week
Japan has a busy data week; Australia reports January jobs data Thursday
Concerns about the coronavirus are likely to keep risk sentiment under pressure, as the ultimate impact is still unknown. Global growth was already at risk before the virus hit and now the outlook is even cloudier.
The dollar rally continues. DXY traded at a new cycle high Friday near 99.166 and remains on track to test the October 1 cycle high near 99.667. After that is the May 2017 high near 99.888.  Elsewhere, the

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Virus Concerns Resurface

12 days ago

Markets are reacting badly to upward revisions to coronavirus cases in China
The euro fell to the weakest level since mid-2017 against the dollar
UK housing data adds to relatively upbeat figures since the December elections
Malaysia’s government is joining in the counter-cyclical fiscal effort
The dollar is mixed on the day. The yen is 0.3% stronger, briefly trading above the ¥110.0 level on negative headlines about China’s coronavirus infections. The euro and pound are little changed while the Norwegian krone is underperforming (-0.3%) with oil around 2% below yesterday’s highs. Equity markets are lower across most Asian countries, but not dramatically so.
The Shanghai Comp was down 0.5% and the Nikkei less than that. The EuroStoxx 600 is down 0.5% and US

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Markets on Edge as New Week Begins

15 days ago

The coronavirus death toll is just over 900, exceeding the SARS epidemic; the dollar remains firm
President Trump will unveil his budget proposal for FY2021 beginning October 1 today
The faltering eurozone economy comes just as political uncertainty is picking up in Germany
Norway inflation spiked in January; Turkish local rates spiked after regulators cut the FX swap limits for local banks
Japan reported December current account data; China January CPI came in at 5.4% y/y in January, higher than expected
The dollar is softer against the majors as the new week begins. Nokkie and Aussie are outperforming, while the yen and Swissie are underperforming. EM currencies are mixed. RUB and CNY are outperforming, while IDR and MYR are underperforming. MSCI Asia Pacific

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Drivers for the Week Ahead

16 days ago

Risk-off sentiment intensified last week; the dollar continues to climb
This is another big data week for the US; the US economy remains strong
Fed Chair Powell testifies before the House Tuesday and the Senate Wednesday; the Senate holds confirmation hearings for Fed nominees Shelton and Waller Thursday
President Trump will unveil his budget proposal for FY2021 beginning October 1 this Monday
Eurozone and UK have heavy data weeks
Riksbank meets Wednesday and is expected to keep rates steady at 0.0%; RBNZ meets Wednesday and is expected to keep rates steady at 1.0%
Risk-off sentiment intensified last week.  Near-term, we think “risk” assets are likely to remain under pressure until the full impact of the coronavirus is better known.  Broad-based dollar strength is

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Dollar Firm Ahead of US Jobs Report

18 days ago

The number of confirmed coronavirus cases and deaths continue to rise; the dollar continues to climb
The January jobs data is the highlight for the week; Canada also reports jobs data
The Fed submits its semiannual Monetary Policy Report to Congress today; Mexico and Brazil report January inflation data
The downdraft in eurozone industrial data continues; Russia cut rates 25 bp to 6.0% and signaled more easing ahead
RBA upbeat but Governor Lowe warns of “significant areas of uncertainty”
Japan reported weak December cash earnings and household spending; emerging Asia focuses on stimulus
The dollar is broadly firmer against the majors ahead of the US jobs data.  Yen and sterling are outperforming, while the Antipodeans are underperforming.  EM currencies are

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Dollar Firm as Markets Await Fresh Drivers

19 days ago

China cut tariffs on $75 bln of US imports by half, while the US said it could reciprocate in some way
The dollar continues to climb; during the North American session, only minor data will be reported; Brazil cut rates 25 bp
Germany reported very weak December factory orders; all is not well in the German state of Thuringia
Czech expected to keep rates steady; Philippines cut 25 bp; India remained on hold
Australia reported December trade and retail sales
The dollar is broadly firmer against the majors as risk-on sentiment starts to fade and markets search for fresh drivers.  Euro and Stockie are outperforming, while sterling and Nokkie are underperforming.  EM currencies are also mostly weaker.  KRW and IDR are outperforming, while THB and RUB are

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Dollar Mixed as Some Risk Appetite Returns

21 days ago

The dollar continues to climb; one of side-effects of the virus has been a swelling of the amount of negative yielding debt globally
The US primary season got off to a rocky start for the Democrats
During the North American session, December factory orders will be reported; the US economy remains strong
The UK reported January construction PMI
The RBA held rates at 0.75%, as expected; Korea January CPI came in hot at 1.5% y/y
The dollar is mixed against the majors as some risk appetite returns to global markets.  Nokkie and Aussie are outperforming, while yen and Swissie are underperforming.  EM currencies are mostly firmer.  ZAR and KRW are outperforming, while SGD and RON are underperforming.  MSCI Asia Pacific was up 1.1% on the day, with the Nikkei rising

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EM Preview for the Week Ahead

22 days ago

EM remains vulnerable to deteriorating risk sentiment as the coronavirus spreads.  China announced a series of measures over the weekend to help support its financial markets, but this may not be enough to turn sentiment around yet.  China markets reopen Monday after the extended Lunar New Year holiday and it won’t be pretty. 
AMERICAS
Brazil reports January trade Monday.  December IP will be reported Tuesday, which is expected to fall -0.8% y/y vs. -1.7% in November.  COPOM meets Wednesday and is expected to cut rates 25 bp to 4.25%.  A handful of analysts see steady rates.  January IPCA inflation will be reported Friday, which is expected at 4.35% y/y vs. 4.31% in December.  If so, inflation would be the highest since May 2019 and in the top half of the

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Dollar Firm Ahead of BOE Decision

25 days ago

The World Health Organization called an emergency meeting today; the dollar continues to climb
The FOMC meeting was a non-event; US advance Q4 GDP will be reported
Risk-off sentiment has derailed curve steepening trades
Implied rates still suggest that today’s BOE meeting is a coin toss
Turkish central bank released its quarterly inflation report; Asian markets got hit hard again with rising virus concerns
The dollar is broadly firmer against the majors ahead of the BOE decision. Yen and Swissie are outperforming, while Nokkie and Aussie are underperforming. EM currencies are mostly weaker. The CEE currencies are outperforming, while RUB and TWD are underperforming.  MSCI Asia Pacific was down 1.8% on the day, with the Nikkei falling 1.7%. MSCI EM is down 2.0% so

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Tentative Stabilization

28 days ago

Risk-off continues in Asia, but moves have been less dramatic
European market jittery but stable
Implied rates now pricing in a full Fed cut by September
The UK will announce its decision on Huawei’s access to the country’s 5G network
The dollar is slightly stronger against most major currencies, so DXY continues on its very gradual grind higher. The index is up 1.6% since the start of the year. Of note, the Australian dollar is down 0.3% reaching at 3-month low at $0.6750. In the EM space, the Korean won is down 0.7%, catching up from the last two days in which it didn’t trade. The Thai baht continues to underperform, down 0.6% on the day and 3.0% on the year.
The 10-year treasury yield is down 3 bps overnight, falling for the sixth consecutive session to 1.581%

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Sharp Sell-Off on Virus Concerns

29 days ago

Global stocks lower on virus fears, yen appreciates, and yield curves flatten
Oil prices continue to fall while gold rises
Italian assets outperform on favorable election results for ruling coalition
German IFO survey disappoints, trimming nascent green shoots
The dollar is mixed against DM and broadly stronger against EM. On the former, the yen is outperforming (+0.4%), heading to the sixth day of consecutive appreciation, now back below the ¥109.0 level. AUD and NZD are underperforming, down around 0.7%. In the EM space, ZAR and MXN are underperforming, down around 1%, while THB (-0.5%) is down the most in EM Asia. Global equity markets are taking a hard hit with the EuroStoxx 600 falling 2.0% and US futures down 1.4%. In Asia, the Nikkei was down 2.0%. Yields

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EM Preview for the Week Ahead

29 days ago

The spread of the coronavirus continues and is likely to weigh on risk assets and EM.  Most markets in Emerging Asia are closed for all or part of this week due to the Lunar New Year holiday.  China has extended the holiday until February 2 as it struggles to contain the virus.  The Asian region is just starting to recover from the global trade tensions, and now it must cope with what is likely to be a sharp drop-off in tourism.  Policymakers in the region may have to tilt more dovish this year if the economic impact becomes significant.
AMERICAS
Brazil reports December current account and FDI data Monday.  Central government budget data will be reported Wednesday, followed by consolidated budget data Friday.  The economy remains sluggish, with the CDI market

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Virus and Trade Tensions

January 24, 2020

Asian markets hit by a further outbreak of the coronavirus
US steps up trade rhetoric against EU and pushes back against UK digital tax plan
AUD stronger on solid Australian jobs report and pricing out of RBA easing
CAD weaker on dovish BOC communication yesterday
Norges Bank and Bank Indonesia keep rates on hold, as expected
ECB meeting concludes shortly, markets await kickoff of strategic review
The dollar is mixed against major currencies but mostly stronger against EM ones. AUD is outperforming (+0.4%) after strong jobs date reduced the odds of easing by the RBA. In contrast, CAD is underperforming after a decidedly dovish statement by the BOC yesterday.
The yen and Swiss franc are stable despite the prevailing nervousness over the virus, but the Chinese yuan

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Dollar Mixed as Risk-Off Impulses Spread from Virus

January 21, 2020

Reports that Wuhan coronavirus continues to spread hurt risk appetite overnight
US President Trump and French president Macron agreed to take a step back from the digital tax dispute
The dollar is taking a breather today; after last week’s huge US data dump, releases this week are fairly light
The UK reported firm jobs data for November; BOJ kept policy steady, as expected
 Moody’s downgraded Hong Kong by a notch to Aa3 with stable outlook; data out of Asia suggest regional trade is starting to recover
The dollar is mixed against the majors as the US returns from holiday.  Sterling and Stockie are outperforming, while Nokkie and Aussie are underperforming.  EM currencies are mostly weaker.  CZK and ZAR are outperforming, while KRW and CNY are underperforming.

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EM Preview for the Week Ahead

January 19, 2020

Market sentiment on EM remains positive after the Phase One trade deal was signed. Data out of China is also supportive for EM. Key forward-looking data this week are Taiwan export orders and Korea trade data for the first 20 days of January. The global liquidity story also remains beneficial for risk, with the ECB, Norges Bank, BOC, and BOJ all set to maintain steady rates this week.
AMERICAS
Mexico reports mid-January CPI Thursday, which is expected to rise 3.16% y/y vs. 2.63% in mid-December. If so, this would be the highest reading since August and back above the 3% target though within the 2-4% target range. Still, Banco de Mexico is likely to continue its easing cycle to help boost the economy. Next policy meeting is February 13 and another 25 bp cut to 7.0%

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Dollar Soft Ahead of Retail Sales Data

January 17, 2020

There were no surprises in the US-China Phase One trade deal
The dollar is drifting lower ahead of the key retail sales data; there are other minor US data out today
Bank of England credit survey showed demand for loans fell in Q4
Turkey cut its one-week repo rate by 75 bps to 11.25%; South Africa is expected to keep rates steady at 6.5%
Japan reported November core machine orders and December PPI; China’s credit numbers for December showed no big change in lending
The dollar is mostly softer against the majors ahead of key US retail sales data. The Antipodeans are outperforming, while yen and Stockie are underperforming. EM currencies are mixed. IDR and MYR are outperforming, while THB and KRW are underperforming. MSCI Asia Pacific was up 0.2% on the day, with

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Some Thoughts on the Latest Treasury FX Report

January 15, 2020

The US Treasury’s latest “Macroeconomic and Foreign Exchange Policies of Major Trading Partners of the United States” report no longer considers China a currency manipulator. The underlying message is that the Trump administration will continue to use an ad hoc “carrot and stick” approach to improve US access to the domestic markets of its major trading partners. This suggests there will still be many minor trade skirmishes this year.
RECENT DEVELOPMENTS
The latest US Treasury FX report no longer names China as a currency manipulator. Recall that China was named a manipulator in August despite being cleared in the previous semiannual report in May.
The reports are usually released in April and October, but the trade war has clearly disrupted this cycle and the

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EM Preview for the Week Ahead

January 13, 2020

EM has been able to get some traction as markets basically shrugged off the risk-off sentiment after the Iran attacks. This week’s planned signing of the Phase One trade deal should help boost EM further, but we remain cautious. The Iran situation is by no means solved, and we see periodic bouts of risk-off sentiment coming from smaller skirmishes. The World Bank also sounded a warning bell last week with its downward revisions to its global growth forecasts.
AMERICAS
Brazil reports November retail sales Wednesday, which are expected to rise 3.7% y/y vs. 4.2% in October. The economy is showing some signs of life, but then so too is inflation. IPCA inflation was 4.31% y/y, the highest since May and above the 4.25% target but still well within the 2.75-5.75% target

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Dollar Builds on Gains as Iran Tensions Ease

January 9, 2020

Markets have reacted positively to President Trump’s press conference yesterday, while the dollar continues to gain traction
The North American session is quiet in terms of US data
Mexico reports December CPI; Peru is expected to keep rates steady at 2.25%
German November IP was slightly better than expected but still tepid; sterling took a hit on dovish comments by outgoing BOE Governor Carney
Israel is expected to keep rates steady at 0.25%
China reported December CPI and PPI; Thailand announced new measures to lean against currency strength
The dollar is mostly firmer against the majors.  Euro and Swissie are outperforming, while Kiwi and sterling are underperforming.  EM currencies are mostly firmer.  KRW and INR are outperforming, while the CEE currencies are

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EM Preview for the Week Ahead

January 6, 2020

While the global economic backdrop remains favorable for EM, rising geopolitical risks will be a growing headwind. The EM VIX surged above 18% Friday as Iran tensions escalated, the highest since early December. With these tensions likely to persist, EM may remain under some pressure for the time being. High oil prices are positive for the exporters in Latin America and the Middle East but negative for the importers in Asia and Eastern Europe.
AMERICAS
Chile reports December trade data Tuesday. December CPI will be reported Wednesday and is expected to rise 3.1% y/y vs. 2.7% in November. If so, inflation would be the highest since September 2018 and above the 3% target though within the 2-4% target range. Next policy meeting is January 29. It’s a tough call but

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EM Preview for the Week Ahead

December 29, 2019

EM FX was broadly firmer last week, taking advantage of the dollar’s soft tone as well as another wave of risk-on sentiment.  Bullishness on the global economy is quite strong, whilst we are perhaps a bit more skeptical given ongoing weakness in the UK, Japan, and the eurozone.  Dollar bearishness may also be overdone given our more constructive outlook on the US economy, but technical damage has been done that must now be repaired.
AMERICAS
Brazil reports November central and consolidated budget data Monday.  Revenue collection has slowed in recent months, even as interest costs have risen.  As a result, the nominal deficit has risen two straight months to stand at -6.35% of GDP in October.  November trade will be reported Thursday.  Next COPOM meeting is

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EM Preview for the Week Ahead

December 23, 2019

EM FX was mostly firmer last week.  ZAR, PEN, and CLP outperformed while TRY, HUF, and CNY underperformed.  MSCI EM traded at new highs for the cycle but ran out of steam near the 1110 area, while MSCI EM FX lagged a bit and has yet to surpass its July high.  Overall, the backdrop for EM remains constructive but investors must be prepared to differentiate amongst credits in 2020.
AMERICAS
Mexico reports mid-December CPI Monday, which is expected to rise 2.71% y/y vs. 3.10% in mid-November.  If so, inflation would be the lowest since August 2016 and would move further below the 3% target.  November trade will be reported Friday, where a -$104 mln deficit is expected.   Banco de Mexico just cut rates 25 bp last week and is likely to continue cutting in 2020.

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Hard Brexit Redux?

December 19, 2019

The risks of a hard Brexit are perhaps higher than markets appreciated. Here, we set forth some possible scenarios as to what may unfold after the January 31 deadline. Uncertainty is likely to be protracted and markets hate uncertainty. As such, we see UK assets continuing to underperform.
RECENT DEVELOPMENTS
Fears of a hard Brexit are still alive and well.  Prime Minister Johnson is pushing to guarantee a Brexit by end-2020 even if a new trade arrangement is not in place.  Under what was expected to be a negotiated Brexit by the January 31, the UK enjoys a transition period until end-2020 in which the current trading arrangement is maintained.  Given how long trade treaties take to negotiate, most observers believed that an extension beyond end-2020 would be

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EM Preview for the Week Ahead

December 16, 2019

Risk assets such as EM got a big boost last week, as tail risks from a hard Brexit and the US-China trade war have clearly ebbed. Still, the initial lack of details on the Phase One deal as well as uncertainty regarding the next phases have left the markets a bit jittery and nervous. Hopefully, this week may bring some further clarity and the good news is that the December 15 tariffs have been canceled. 
AMERICAS
Brazil COPOM minutes will be released Tuesday. It cut rates 50 bp and left the door open to further easing, so the minutes will be of interest to the markets. The central bank then releases its quarterly inflation report Thursday. Mid-December IPCA inflation will be reported Friday, which is expected to rise 3.71% y/y vs. 2.67% in mid-November. If so, it

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Risk Assets Rally as Major Tail Risks Ease

December 13, 2019

The biggest tail risks impacting markets this year have cleared up; risk assets are rallying, while safe haven assets are selling off
During the North American session, US November retail sales will be reported
Russia central bank cut rates 25 bp to 6.25%, as expected
Bank of Japan released a mixed Q4 Tankan report
The dollar is broadly lower against the majors as tail risk evaporates.  Nokkie and sterling are outperforming, while Aussie and yen are underperforming.  EM currencies are broadly firmer.  KRW and RUB are outperforming, while THB and INR are underperforming.  MSCI Asia Pacific was up 1.6% on the day, with the Nikkei rising 2.6%.  MSCI EM is up 1.6% so far today, with the Shanghai Composite rising 1.8%.  Euro Stoxx 600 is up 1.7% near midday, while US

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EM Preview for the Week Ahead

December 9, 2019

EM has had a good month so far as market optimism on a Phase One trade deal remains high.Yet November trade data due out this week should show that until that deal is finalized, the outlook for EM remains weak. Deadline for the next round of US tariffs is December 15 and so talks this week are crucial. Lastly, three major EM central banks are expected to cut rates this week, underscoring the downside risks to growth.
AMERICAS
Mexico reports November CPI Monday, which is expected to rise 3.0% y/y vs. 3.02% in October. If so, inflation would be right at the target. Next policy meeting is December 19 and another 25 bp cut to 7.25% is expected. October IP will be reported Thursday, which is expected to contract -1.8% y/y, same as September.
Chile reports November

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Dollar Soft on Weak Data and the Return of Tariff Man

December 3, 2019

The dollar has taken a hit from the weaker than expected data Monday
Tariff man is back
The US economy remains solid in Q4 but there are some worrying signs for the November jobs data Friday
The political pressure on Turkey from the US could increase soon; South Africa’s Q3 GDP came in well below expectations at -0.6% q/q and 0.1% y/y
Japan JGB auction went poorly on supply concerns ahead of planned fiscal stimulus; RBA kept rates steady at 0.75% but the outlook was upbeat
The dollar is mostly weaker against the majors in the wake of weak US data yesterday.  Aussie and sterling are outperforming, while euro and Nokkie are underperforming.  EM currencies are mostly weaker as trade 7tensions rise.  PHP and MXN are outperforming, while ZAR and KRW are

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EM Preview for the Week Ahead

December 2, 2019

Over the weekend, China reported stronger than expected November PMI readings while Korea reported weaker than expected November trade data.  While the China data is welcome, we put more weight on Korea trade numbers, which typically serve as a good bellwether for the entire region.  Press reports suggest the Phase One trade deal has stalled due to Hong Kong legislation passed by the US Congress.  Until a deal is wrapped up, we remain cautious on EM. 
AMERICAS
Chile reports October GDP proxy Monday, which is expected to contract -0.5% y/y vs. +3.0% in September.  Retail sales will be reported Tuesday, which are expected to contract -4.4% y/y vs. -0.9% in September.  The central bank meets Wednesday and is expected to cut rates 25 bp to 1.5%.  However, the weak

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