Tag Archives: newsletter

Summary Tensions on the Korean peninsula appear to be easing. Relations between Pakistan and the US have worsened. The Philippine central bank is tilting more hawkish. The ANC may consider removing Zuma from the presidency at the January 10 meeting of its National Executive Committee. Turkish banker Atilla was convicted of helping Iran evade US financial sanctions. Argentina sold $9 bln of dollar-denominated external...

Central banks are now trapped. In a nutshell, central banks are promising to “normalize” their monetary policy extremes in 2018. Nice, but there’s a problem: you can’t “normalize” markets that are now entirely dependent on extremes of monetary stimulus. Attempts to “normalize” will break the markets and the financial system. Let’s start with the core dynamic of the global economy and nosebleed-valuation markets:...

Swiss Franc The Euro has risen by 0.04% to 1.1753 CHF. EUR/CHF and USD/CHF, January 05(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates As the US dollar finished last year, so too did it begin the New Year, and after extending its losses, the bears have paused. Technical factors had been stretched, but it appears to have been old-fashioned macroeconomic considerations to...

United States The headline US non-farm payrolls disappointed, rising by 148k instead of the consensus of 180k-200k. However, the other details were largely as expected and are unlikely to change views about the trajectory of Fed policy or the general direction of markets. It is a very much steady as she goes story. The headline miss is not really made up for by the upward revision in the November series from 228k to...

Keen to ride the digital wave: Switzerland is attracting many fintech startups (Keystone) - Click to enlarge The year 2017 saw a record number of businesses created in Switzerland, many of them centred in the booming ‘crypto valley’ region, according to online platform startups.ch. Some 43,416 businesses were created, said the information and advisory websiteexternal link, an increase of 5% on 2016 and an...

Cycles and Sentiment Another recurring pattern consists of the seasonally strong period in gold around the turn of the year, which is bisected by a mid to late December interim low in the gold price. An additional boost can be expected in January and Feburary from the strong seasonal uptrend in silver and platinum group metals as well (to see the seasonal PGM charts, scroll down to our addendum to this recent article...

There is no change to the risk budget this month. For the moderate risk investor the allocation to bonds is 50%, risk assets 45% and cash 5%. The extreme overbought condition of the US stock market persists so I will continue to hold a modest amount of cash. There are some minor changes within the portfolios but the overall allocation is unchanged. - Click to enlarge There have been two major developments since...

Gold Has Best Year Since 2010 With Near 14% Gain In 2017 – Gold posted second straight annual gain in USD in 2017– Gold in 2017: up 13.6% USD, up 2.7% GBP, down 1.4% EUR– 2017 is gold’s best year since 29.5% gain in 2010– Strong performance despite rate hikes and stock bubble  – India’s gold imports surged 67% in 2017, Turkish, Chinese demand strong – Gold finished 2017 with longest rally since June 2016 – 2018:...

The New Year may have begun in fact, but in practice, full participation may return only after the release of US employment data on January 5. The macroeconomic and policy tables have been set, though interpolating from the Overnight Index Swaps market, there is 45% chance the Bank of Canada hikes rates at its policy meeting near the middle of the month. In the currency markets, sentiment appears to be as uniformly...

Swiss Franc The Euro has risen by 0.03% to 1.1703 CHF. EUR/CHF and USD/CHF, January 02(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates The US dollar’s slump seen in the final two weeks of 2017 is carried into today’s activity. The greenback’s sell-off extends to the emerging market currencies as well. The Hungarian forint is the strongest rising nearly 1%, ostensibly...