Tag Archives: 4) FX Trends

It might not feel like a New Year, as the pandemic continues to ravage most countries. On top of the human toll, the economic fallout will continue to depress activity in the first part of 2021.  However, policymakers throughout the G7 provided more stimulus in late 2020 and extended many emergency facilities well into the New Year.  This will help cushion the blow and help facilitate a stronger recovery later in the year. The two Senate seats in Georgia being...

Rising prices feature in many economic forecasts for the US.  It is seen as part of the reflation meme as the vaccines roll out.  There seem to be three threads to the discussion.  The first is practically mathematically certain.  Economists refer to it as the base effect.  As the pandemic struck and the economy shut down, prices fell.  Headline CPI fell by 0.4% in March 2019, by 0.8% in April, and another 0.1% in May.  The PCE deflator, which the Fed targets, fell...

I joined Ben Lichtenstein, host of the morning futures program at TDAmeritrade.  It is in the futures market that I began my career, and where I gained respect for local traders, who do not have a large institutional backing such as a bank or hedge fund, and are trading their own capital, and taking the risk often from those institutional participants.  There is truly a David vs. Goliath drama being played out with asymmetries of information and depth of capital...

The foreign exchange market sees an average daily turnover of something on the magnitude of $6.6 trillion a day.  In a week, the turnover is sufficient to more than cover world trade for a year.  It is the largest of the capital markets.  Trends in the currency market can last for years. A little more than a year ago, we concluded that the dollar’s third significant rally since the end of Bretton Woods was over and that a cyclical dollar decline was at hand.  Yet the...

No daily commentary until the New Year, but watch this space for thematic pieces over the next two weeks. Here is to a safe, healthy, and prosperous 2021. Thank you for your support. You Might Also Like FX Daily, July 1: Second Verse Can’t be Worse than the First, Can it? 2020-07-01 The resurgence of the contagion in the US has stopped or reversed an estimated 40% of the re-openings, but the appetite for...

Swiss Franc The Euro has risen by 0.22% to 1.0824 . FX Rates Overview: The prospects of a UK-EU deal and US stimulus continue to underwrite risk appetites and weigh on the dollar. Equity markets are moving higher. Led by Australia and China, the MSCI Asia Pacific Index rose to new record highs, while Dow Jones Stoxx 600 in Europe is at its best level since February. US shares are also trading higher. Bond markets are quiet, with European yields paring yesterday’s...

Swiss Franc The Euro has risen by 0.26% to 1.0789 EUR/CHF and USD/CHF, December 16(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates Overview: The S&P 500 snapped a four-day downdraft helped by optimism over the progress toward fiscal stimulus and some hope that a new trade deal can still be negotiated between the UK and EU. Europe reported better than expected PMIs. Equities are broadly higher, as are interest rates,...

Swiss Franc The Euro has risen by 0.12% to 1.0775 EUR/CHF and USD/CHF, December 15(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates Overview: The S&P fell for the fourth consecutive session yesterday, the longest losing streak of the quarter, and this seemed to encourage profit-taking in the Asia Pacific region today. The MSCI Asia Pacific Index slipped for the second consecutive session, and even confirmation of the...

I had the privilege to join Sri Jegarajah at CNBC Asia at the start of today’s Asia Pacific session.  We had a broad chat about the dollar, Brexit, and the euro. He gave me the opportunity to sketch out my views: The dollar’s entered a cyclical decline, and the “twin deficit” issue will likely frame the narrative. Many observers do not use that particular phrase now, but their arguments seem to rest on one if not both of the legs. Sterling gains appear to be more...

Swiss Franc The Euro has risen by 0.06% to 1.0776 EUR/CHF and USD/CHF, December 14(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates Overview: The fact that the UK and EU negotiators are still talking is seen as a constructive development and has spurred a sharp bounce in sterling. It traded below $1.3150 before the weekend and is pushing above $1.3400 in the European morning. It is part of the larger risk-on move lifting...