SNB & CHF

Stock Markets EM FX was mostly firmer last week, helped by Trump comments and softer US data.  Whilst this seems positive for EM, the global backdrop remains uncertain.  Some in EM (Russia, Turkey, and Korea) remain vulnerable to geopolitical concerns. In addition, idiosyncratic domestic political risks remain in play for other EM countries, such as Brazil, South Africa, and Turkey.  We expect the investment climate...

Summary: Monetary policy is off the table for at least the next two months. Several fiscal issues are coming to a head. Despite the GOP majority in Congress and White House, brinkmanship cannot be ruled out. The Federal Reserve hiked rates in March.  Whatever gradual hikes mean, it seems to preclude moves in back-to-back meetings.  There are two chances of a May hike:  Slim and none and Slim left town. June...

As with all statistics, there are discrepancies that from time to time may obscure the meaning or validity of the particular estimate in question. For the vast majority of the time, any such uncertainties amount to very little. Overall, harmony among the major accounts reduces the signal noise from any one featuring a significant inconsistency. There are, of course, various economic areas where estimates are going to...

Summary Malaysia’s central bank said it will allow investors to fully hedge their currency exposure. Egypt declared a 3-month state of emergency after two deadly church attacks. South Africa’s parliamentary no confidence vote has been delayed Argentina central bank surprised markets with a 150 bp hike to 26.25%. Brazil central bank accelerated the easing cycle with a 100 bp cut in the Selic rate. Stock Markets In the...

Many observers misunderstood US President Trump’s “American First” rhetoric. Trump’s earlier writings show that this is not a reference to the 1940s effort to keep the US out of WWII, with its isolationist tint. Rather, Trump’s use goes back to the original use by President Harding in the 1920s. It was a rejection of the Wilsonian multilateralism (e.g. League of Nations) and a robust defense of unilateralism. That...

Click here for the full transcript with slides: http://financialrepressionauthority.com/2017/04/16/the-roundtable-insight-charles-hugh-smith-on-the-commercial-real-estate-bubble-caused-by-financial-repression/

Swiss Franc Currency Index Last week the Swiss Franc improved against both euro and dollar, but – compared to its safe-haven counterpart Japanese Yen – it had a bad performance. We expect strong SNB interventions, that reflect the demand for CHF safe-haven. Trade-weighted index Swiss Franc, April 14(see more posts on Swiss Franc Index, ) Source: markets.ft.com - Click to enlarge Swiss Franc Currency Index (3...

Summary: US yields have trended lower as oil prices have trended higher. The correlation between the 10-year breakeven and oil has also weakened considerably. Technicals readings are getting stretched, but no compelling sign of a top. Rising oil prices traditionally boost inflation expectations and US interest rates. The May futures contract for light sweet crude oil is up today for the sixth consecutive...

As earnings season begins for Q1 2017 reports, there isn’t much change in analysts’ estimates for S&P 500 companies for that quarter. The latest figures from S&P shows expected earnings (as reported) of $26.70 in Q1, as compared to $26.87 two weeks ago. That is down only $1 from October, which is actually pretty steady particularly when compared to Q4 2016 estimates that over the same time plummeted from $29.04...

– Perth Mint’s silver bullion sales rise 43% in March.– Perth Mint’s monthly gold coin, bars sales fall 12%.– Gold silver ratio of 32 – 32 times more silver ounces sold.– Gold: 22,232 oz and Silver: 716,283 oz – bullion coins and minted bars sold. – Gold is 2.6% higher and silver surged 3.1% in the shortened week with markets closed for Good Friday tomorrow. Australian Kangaroo 2017, 1 oz 9999 Silver The Perth Mint’s...