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Tag Archives: EUR

FX Weekly Preview: The Week Ahead is not about the Week Ahead

It’s the last week of August. Several economic reports will be released in the coming days. They include the US deflator of consumer expenditures that the Federal Reserve targets, China’s PMI, and the eurozone’s preliminary August CPI. It is not that the data do not matter, but investors realize the die is cast. They are looking further afield. The next US tax increase on Chinese imports goes into effect on September 1, and Beijing has threatened to retaliate. The...

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FX Daily, August 22: Tick Up in EMU PMI Does Little, Waiting for Powell

Swiss Franc The Euro has risen by 0.17% to 1.0905 EUR/CHF and USD/CHF, August 22(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates Overview: Soft data in Asia and the continued decline in the yuan (six days and counting) prevented Asian equities from following the US lead from yesterday when the S&P 500 advanced by 0.8%. European shares are paring yesterday’s 1.2% advance despite an unexpected gain in the EMU flash PMI....

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Seven Points on the ECB and the Price Action

- Click to enlarge 1. As soon as it was clear that the ECB was not easing today, the euro began to recover, after making a marginal new low for the year (just above $1.11). 2. Draghi made it clear that easing was going to be delivered in September and on several fronts including rates (with mitigating measures like tiering) and new asset purchases (not decided on instruments, which plays into speculation of equity...

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Great Graphic: Euro’s (OECD) PPP

US President Trump recently bemoaned the fact that the euro is undervalued. While his critics complain that he is prone to exaggeration, in this case, the euro is undervalued. This Great Graphic a 30-year chart of the euro has moved around its purchasing power parity as measured by the OECD. Currently, the euro is about 22% undervalued, and it has been cheap to PPP since for the past five years. The OECD’s model...

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FX Daily, June 10: Collective Sigh of Relief Lifts Equities, Yields, and the Dollar

Swiss Franc The Euro has risen by 0.11% at 1.1186 EUR/CHF and USD/CHF, June 10(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates Overview: A global sigh of relief that the US will not tariff all its imports from Mexico. Equities are all higher, and the weekend demonstrations in Hong Kong over a bill allowing extraditions to the mainland for the first time did not deter...

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The Thumbnail Sketch of the Euro You are Looking For

Here is an overview of the broad macro considerations for the euro, with some thoughts about the price action, including volatility. It is shared not so much as an argument as a sketch the considerations that drive a view.  1. An 18-month low for the euro was set on April 26 a little above $1.11, immediately after the US reported a stronger than expected Q1 GDP report. The euro has been consolidating here in May and has...

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FX Daily, April 12: Euro Bid Above $1.13 for the First Time this Month

Swiss Franc The Euro has risen by 0.29% at 1.1317 EUR/CHF and USD/CHF, April 12(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates Overview: The consolidative week in the capital markets is drawing to a close. Equity markets are narrowly mixed. In Asia, most indices outside of the greater China (China, Taiwan, and Hong Kong) edged higher, leaving the MSCI Asia Pacific Index...

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April Monthly Currency Outlook

Poor economic data and soft inflation saw several central banks, including the Federal Reserve and European Central Bank, take a dovish turn in March. Contrary to expectations that interest rates would rise as the G3 central banks were no longer adding to their balance sheets on a combined basis. The sharp drop in interest rates and the flattening of curves in March is one of the key factors shaping the investment...

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FX Daily, March 29: Equities Bounce While Bonds Pullback to End Q1

Swiss Franc The Euro has keep position 0.00% at 1.1194 EUR/CHF and USD/CHF, March 29(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates Overview: The global growth scare may be subsiding. It had been fanned by the ECB and Fed statements and projections. Poor US jobs growth reported in early March and the poor flash EMU PMI late in the month contributed. The slowdown in China...

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FX Daily, March 28: Brexit Uncertainty Deepens as Parliament is Divided, while Turkey’s Short Squeeze Falters

Swiss Franc The Euro has risen by 0.07% at 1.1192 EUR/CHF and USD/CHF, March 28(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates Overview: The lurch lower in global interest rates continue. The US 10-year yield is at new 15-month lows, five basis points through the average effective Fed funds rate. Late yesterday, it appeared that 10-year German Bund yields slipped below...

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