Tag Archives: Featured

Neuchâtel, 5 October 2018 (FSO) – The consumer price index (CPI) increased by 0.1% in September 2018 compared with the previous month, reaching 101.9 points (December 2015 = 100). Inflation was 1.0% compared with the same month of the previous year. These are the results of the Federal Statistical Office (FSO). The 0.1% increase compared with the previous month can be explained by several factors including rising prices...

This Great Graphic comes from Peter Coy and team’s article in Business Week. It succinctly shows three metrics for the internationalization of domestic currencies: global payments, international bonds, and foreign exchange reserves. It does not strike me as surprising, and the role of the euro as a payments currency reflects its role in intra-European trade. The substance of the article bears little relation to the...

Short-term noise means we are neutral on the euro over the next three months, but see potential for its gradual appreciation against the dollar thereafter We have long argued that growth and interest rate differentials are two key components for the direction of the US dollar. Both these drivers should continue to support the dollar over the short term. Indeed, economic growth in the US is likely to be strong thanks...

Swiss products exported to Turkey may also be too expensive for local markets because of the current weakness of the Turkish lira. The severe policies of President Recep Tayyip Erdogan have led to Swiss companies decreasing their investments in Turkey by 50% compared to the average over the past decade, Swiss Public Television SRF reports. Over the last ten years, Swiss companies have on average invested some CHF200...

On April 2, the benchmark 10-year US Treasury yield traded below 2.75%. It had been as high as 2.94% in later February at the tail end of last year’s inflation hysteria. But after the shock of global liquidations in late January and early February, liquidity concerns would override again at least for a short while. After April 2, the BOND ROUT!!!! was re-energized and away went interest rates. Between that date and May...

Swiss Franc The Euro has risen by 0.29% at 1.1419 EUR/CHF and USD/CHF, October 04(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates The US dollar is consolidating yesterday’s gains against most of the major currencies, though the dollar bloc is underperforming. Bond yields are moving higher, and equities are lower. With a light data and events stream, the price action itself...

Risks from the international arena, such as the potential impact of a no-deal Brexit on world trade, threaten to upset exporters’ recovery from the 2015 strong franc shock. (Keystone) Switzerland’s GDP is on track this year to increase by 2.9%, according to a forecast by Zurich’s KOF Swiss Economic Instituteexternal link published Wednesday. This positive outlook is tempered by concerns over the potentially negative...

More policy support is expected, and may lead to slight rebound in Q4. China’s manufacturing PMIs softened further in September, indicating that growth momentum is likely continued to moderate in Q3 and that the weakness may extend into Q4. In response to the weakening growth momentum, especially in the context of escalating trade tensions with the US, the Chinese government has turned to policy easing since June. The...

We’re living in a fantasy, folks. Bubbles pop, period. The nice thing about the “wealth” generated by bubbles is it’s so easy: no need to earn wealth the hard way, by scrimping and saving capital and investing it wisely. Just sit back and let central bank stimulus push assets higher. The problem with bubble “wealth” is it’s like an addictive narcotic: now our entire pension system, public and private, is dependent on...

Costco This is a textbook case. Well, it would be if there was a textbook that presented the dynamics of the rising and falling interest rate cycles. Costco is spending over a quarter billion dollars, to make a capital investment in chicken processing. This is not the typical entrepreneurial investment, which seeks to increase margins by serving an unserved or underserved demand. This is an investment made with...