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Tag Archives: 5.) Brown Brothers Harriman

Dollar Bid as Market Sentiment Worsens

The virus news stream out of Europe has improved a bit The US is already taking about the next relief bill; the Fed continues to roll out measures to address dollar funding issues ADP and ISM manufacturing PMI are the US data highlights Regulators across Europe are asking banks to stop paying dividends; eurozone and UK reported final manufacturing PMIs Japan Q1 Tankan report was released; BOJ tweaked its bond buying program for April RBA minutes were released; Korea...

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Drivers for the Week Ahead

Markets continue to digest the implications of the Fed’s bazooka moment last week The data highlight this week will be March jobs data Friday; key manufacturing sector data will come out earlier in the week On Friday, BOC delivered an emergency 50 bp rate cut to 0.25% and started QE Final eurozone and UK PMI readings for March will be reported; late Friday, Fitch cut UK’s rating by a notch to AA- with negative outlook Japan has a fairly busy data week; RBA minutes...

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ECB Approaching its Bazooka Moment

The ECB appears to be moving closer to activating Outright Monetary Transactions (OMT). Despite being part of Draghi’s “whatever it takes” moment, OMT has never been used. If the Fed’s open-ended QE is seen as dollar-negative, then OMT should be seen as euro-negative. ECB Balance Sheet Total Assets, 2010-2019 - Click to enlarge RECENT DEVELOPMENTS At the regularly scheduled March 12 meeting, the ECB delivered a package of easing measures that were in hindsight...

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Drivers for the Week Ahead

Risk sentiment is likely to remain under pressure this week as the impact of the coronavirus continues to spread; demand for dollars remains strong As of this writing, the Senate-led aid bill has stalled; the US economic outlook is getting more dire; Canada is experiencing similar headwinds This is a big data week for the UK; eurozone March flash PMIs will be reported Tuesday; oil prices continue to slide Japan has a heavy data week; RBNZ will start QE; China offers...

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Dollar Firm, Markets Unsettled Despite Aggressive Policy Responses Worldwide

Markets remain unsettled even as policymakers worldwide continue to take aggressive emergency measures; the dollar continues to power higher Fed rolled out another crisis-era program last night; US Senate passed the House virus relief bill by a 90-8 vote ECB held an emergency call last night and announced an additional bond purchase program to the tune of €750 bln that now includes commercial paper SNB kept rates steady at -0.75% as expected; BOJ continues to flood...

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EM Preview for the Week Ahead

Market sentiment is likely to open this week on an upswing after the Fed’s emergency rate cut and expanded QE were announced Sunday afternoon local time.  Yet as we have seen time and again this past couple of weeks, added stimulus has had little lasting impact on markets as the virus numbers continue to worsen.  Europe is now reporting more daily cases than China did at its peak.  We remain negative on EM until the global growth outlook becomes clearer. AMERICAS...

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Dollar Firms, Equities Sink Ahead of ECB Decision as US Fails to Deliver

President Trump spoke to the nation last night and did little to calm markets; reports suggest that the Democrats are working on a bill Fed easing expectations are intensifying The ECB decision will be out at 845 AM ET; over the past 17 ECB decision days, the euro has finished lower in 11 of them Reports suggest the Bank of Japan is “likely to strengthen stimulus” next week; Australia announced details of its AUD17.6 bln stimulus plan The dollar is broadly firmer...

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Dollar Soft as BOE Surprises Ahead of UK Budget

The dollar is stabilizing but remains vulnerable to disappointment as markets await details of US fiscal measures US reports February CPI; Joe Biden moved closer to clinching the Democratic nomination BOE delivered a surprise 50 bp rate cut to 0.25% and initiated a new lending scheme; UK government releases its budget today; UK reported weak data RBA Deputy Governor Debelle laid out the likely path for unconventional policy; China reported disappointing money and...

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ECB Preview, March 11

Christine Lagarde will chair her third ECB meeting Thursday.  She faces growing risks of recession but also widespread skepticism within the ECB regarding the efficacy of negative rates.  Markets have priced in several rate cuts this year.  Here, we discuss what measures the ECB may take this week. POLICY OUTLOOK It’s worth noting that even with the complicated voting rights system, a formal vote is not always needed to act.  For instance, at the September 2019...

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Dollar Firm as Global Financial Markets Calm

Global financial markets are finally seeing a measure of calm return; local Chinese media is sounding more confident that the situation is now under control The White House will announce fiscal measures today; five states hold primaries and one holds a caucus with 352 total pledged delegates up for grabs Italy announced that it is extending travel curbs beyond just the north to the entire nation; further fiscal measures there will be seen Japan reported February...

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