Tag Archives: 4) FX Trends

You would never have guessed it reading many of the op-eds and pundits pronouncing the end to globalization or the West, or liberalism. Global equities have rallied. Of course,  stock prices are not the end all and be all, but it stands in stark contrast to the cries that the sky is falling. The MSCI World Index of developed markets advanced for the second consecutive week adding 2.2%. The US S&P 500 moved above...

The Dollar Index made a marginal new high for the year at the end of June a touch below 95.55. It fell through the start of this week when it reached nearly 93.70. With the earlier gains, the Dollar Index briefly traded above the 61.8% retracement of the pullback  (~94.85). A move now below 94.20 would be disappointing. The Dollar Index is not a trade-weighted. It is too concentrated in Europe and does not include two...

The US economy is among the strongest among the large economies. Goosed by the never-fail elixir of tax cuts and spending increases, the US economy is accelerating.  Nevertheless, we continue to see the fiscal boost as short-lived, and a recent Fed paper suggested that fiscal stimulus in an upswing may not have the same multiplier as during a downturn. Evidence of late-cycle behavior continues to accumulate. We have...

Swiss Franc The Euro has risen by 0.01% to 1.1698 CHF. EUR/CHF and USD/CHF, July 13(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates Sterling’s 0.6% loss (@ ~$1.3120) is co-leading the downside in the firm US dollar environment, having to share that role with the New Zealand dollar today, where a weaker manufacturing PMI (52.8 from 54.4) is taking a toll. Both sterling and...

Swiss Franc The Euro has risen by 0.65% to 1.1698 CHF. EUR/CHF and USD/CHF, July 12(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates The dollar has broken out against the Japanese yen. Despite the global equity drop and decline in US yields, which often underpin the yen, the yen fell to its lowest level since early January yesterday and is continuing to sell-off today. The...

Swiss Franc The Euro has fallen by 0.06% to 1.1639 CHF. EUR/CHF and USD/CHF, July 11(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates The US took the first step in making good its threat to put a 10% tariff on $200 bln of Chinese goods in response to the PRC retaliating for the 25% tariff on $34 bln of its exports. The US provided a list of products that will get the new...

Swiss Franc The Euro has fallen by 0.13% to 1.1632 CHF. EUR/CHF and USD/CHF, July 10(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates The euro was already trading with a heavier bias, having been turned back after approaching the $1.18 level yesterday. The disappointing Geman survey data encouraged some late longs to be cut, driving the euro to the session low near $1.1715,...

A survey of central banks and sovereign wealth funds by Invesco sheds light on their investment plans. The traditional separation of markets and the state may be helpful for ideological arguments, but the real situation is more complicated. Central banks and their investment vehicles (sovereign wealth funds) are market participants. In some activities, such as custodian, central banks compete with the private sector....

Swiss Franc The Euro has risen by 0.17% to 1.164 CHF. EUR/CHF and USD/CHF, July 09(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates After a little wobble, sterling has responded favorably to the resignation of the UK Brexit team led by David Davis. The idea is that a path to a softer Brexit is good for sterling. In fairness, it is a bit early to reach this conclusion, and...

The triumphalism that followed the fall of the Berlin Wall nearly three decades ago has evaporated. The Great Financial Crisis and inexorable widening of income and wealth inequalities within countries undermined claims of moral and economic superiority. Liberal democracies are fighting a rearguard action and the rise of illiberal regimes. The president of the country with the strongest military might and largest...