Tag Archives: Mexico

Overview: The US dollar has come back bid after losing ground against most currencies as the markets reacted to the FOMC decision and press conference. The Antipodeans and Scandis have been tagged the hardest, illustrating the risk-off mood, and arguably the weakening growth prospects. Countries that peg their currencies to the dollar have hiked rates, as has the Philippines and Taiwan. The Swiss National Bank and Norway have also lifted policy rates by 50 bp and 25...

Overview: There are two themes today. First, there has been a modest bout of profit-taking on Chinese stocks (and yuan) after last week’s surge. Second, the ahead of the five G10 central bank meeting this week a series of market-sensitive economic reports, a consolidative tone is seen in most of the capital markets. Most of the large bourses in the Asia Pacific region fell, led by a 2.2% loss in Hong Kong and 3% loss in its index of mainland shares. Europe’s Stoxx...

Half of the G10 central banks meet in the week ahead. The Fed is first on December 14, and the ECB, BOE, Swiss National Bank, and Norway's Norges Bank meet the following day. Before turning a thumbnail sketch of the central banks, let us look at the November US CPI, which will be reported as the Fed's two-day meeting gets underway on December 13. The terms of the debate have shifted. It is no longer about when US inflation will peak but how fast it will come down....

Overview: There is nervous calm in the capital markets today.  The weakness of US shares yesterday is taking a toll today. An exception in the Asia Pacific region is the Hang Seng and the index of mainland shares that trade there, which up around 3.5% today on thUe easing of some Covid protocols.  Europe’s Stoxx 600 is off for a fifth day, its longest losing streak in nearly two months. US futures are posting minor gains. Benchmark 10-year yields are mostly little...

Overview: Chinese officials using the carrot and the stick have succeeded in dampening the protests and easing some anxiety and rekindled the animal spirits. Hong Kong’s Hang Seng rallied 5.25% and its index of mainland shares surged 6.20%. South Korea and Taiwan indices gained more than 1%. Among the large bourses, only Japan failed to advance. Softer than expected Spanish and German inflation may also be helping the Stoxx 600 recoup around half of yesterday’s...

Overview: The surging Covid cases in China and the protests in several cities seemed to set the tone for today’s session. Equities are lower. China, Hong Kong, Taiwan, and South Korea were marked down the most. Of the large bourses, only India escaped unscathed. Europe’s Stoxx 600 is off more than 0.8% and US futures are poised to gap lower. Bond markets are quieter. The 10-year US Treasury yield is off a little more than one basis point to around 3.66%. European...

Overview: The US dollar is trading with a somewhat heavier bias after bouncing higher yesterday. All the G10 currencies are higher, led by the New Zealand dollar, where the central bank is expected to hike first thing tomorrow. Most emerging market currencies are also firmer. Those that are not, like the South Korean won and Mexican peso, are nursing minor losses. The surge in Covid cases weighed on Chinese shares that trade in Hong Kong, while the CSI 300 posted...

Overview:  The softer than expected US inflation figures unleashed significant market adjustment that continue to ripple through the capital markets. The modification of some of China’s Covid stance may have also fanned some optimism, but we suggest that measures are modest tweaks, and the surge in infections will prevent the end of disruptive restrictions. Although we have been arguing that a significant dollar top was being forged, the move is stretched from a...

There are three potential inflection points. The first is a pause from the Fed; if nothing else, Powell signaled it was too early to think about it. The second is for the Bank of Japan to change monetary policy. Governor Kuroda has signaled that it is not time. Conventional wisdom is there will not be a change until Kuroda's term ends next April. However, we note that the surveys suggest economists and BOJ inflation forecasts for next year have converged. The third...

Overview: Risk appetites have returned today. Bonds and stocks are advancing, while the dollar is better offered. Unsourced claims that Beijing has formed a committee to assess how to exit the zero-Covid policy sent Chinese shares sharply higher. An index of mainland companies list in Hong Kong jumped nearly 7% and closed up almost 5.5%. The Hang Seng surged 5.2%, while all the large markets in the region advanced. Europe’s Stoxx 600 recovered yesterday and is up...