Tag Archives: RBA

Overview: Within hours of the US giving permission to Ukraine to use US weapons to strike Russian territory, which it did, Moscow announced a change it is nuclear doctrine that allow for the use of nuclear weapons against a conventionally armed adversary that is backed by nuclear powers. This follows on the heels of the failure of two telecom cables yesterday (Germany-Finland and Sweden-Lithuania). This escalation is roiling the capital markets. Bonds are rallying....

Overview: The US dollar has begun the new week consolidating in a mixed fashion against the G10 currencies. Bank of Japan Governor Ueda remains circumspect and did not provide guidance about next month's central bank meeting. Without positive guidance, the market sold the yen, but the swaps market shows about 13 bp of tightening has been discounted, up a couple of basis points from a week ago. Leave aside the New Zealand dollar, which is also under pressure ahead of...

Overview: A nervous calm hangs over the markets as the US goes to the polls. The proximity of the presidential contest warns that the results may not been known as soon as people hope. Indeed, many fear the voting simply begins the next phase of the contest, with premature declarations of victory and disputes over votes. The dollar is in mostly narrow ranges today, but the Antipodeans and Scandis are the strongest, and the Reserve Bank of Australia kept rates on...

Overview:  The US 10-year yield is off around a dozen basis points off yesterday's high and European growth in Q3 was better than expected. This appears to have encouraged some dollar liquidation today. The greenback is softer against the G10 currencies, but the Canadian dollar and sterling. The much-awaited UK Autumn budget will be announced shortly. Sterling is consolidating around $1.30. Most emerging market currencies also are enjoying a firmer tone today. Asia...

Overview: A consolidative tone is emerging in the foreign exchange market as the week's key events begin tomorrow:  UK budget, eurozone and US Q3 GDP, and the US ADP private sector jobs estimate, and quarterly refunding. Outside of the Norwegian krone, which is up nearly 0.5%, the other G10 currencies are largely +/- 0.1%. The yen, Swiss franc, and antipodeans are trading with a slightly heavier bias. Among emerging market currencies, most from the Asia Pacific...

Overview: The stronger than expected US jobs report triggered a 20 bp jump in the US two-year yield and sent the greenback broadly higher. The market slashed the probability that the Fed would cut by 75 bp in Q4. There are now slightly less than 50 bp discounted in the Fed funds futures strip. US rates have continued to back up today, and both the two- and 10-year yields traded above 4% today. The greenback is mostly firmer, though the yen, Swiss franc, and...

Overview: Weak US consumer confidence, especially regarding the labor market boosted speculation of another half-point Fed cut in November when the central bank meets again. This weighed on the dollar. Sterling and the Australian dollar rose to new 2 1/2-year highs. The PBOC followed up yesterday's package with a 30 bp cut in the one-year Medium-Term Lending rate. After extending its losses earlier today, the dollar has steadied and turned higher against most of the...

Overview:  The calls earlier this week for an emergency rate cut seemed to be a call for the Fed put, which, we argue is misunderstood. It is not about the stock market per se but financial stability, which did not seem threatened in the US. Japan is a different story, and the Bank of Japan offered a verbal put today, with an indication that it wants to maintain low (accommodative) rates. The markets reacted accordingly. The yen was sold (and dragged down the Swiss...

Overview: The dollar has caught a bid ahead of the US retail sales and industrial production figures. It is higher against all the G10 currencies but the Swiss franc. The SNB meets Thursday. It surprised many by cutting rates in March and the same logic (low inflation, move ahead of the ECB, stronger franc) may apply now. A hawkish hold by the Reserve Bank of Australia has not done much for the Australian dollar, which is little changed on the day. The greenback...

Overview: The dollar is firmer against all the G10 currencies today. The market is somewhat less fearful of intervention and the yen is extending yesterday's losses. It is rivaling the Australian dollar for the weakest of the major currencies after the Reserve Bank of Australia left rates on hold and played down speculation of possibility of a rate hike. Both currencies are off around 0.4% in late European morning turnover. Disappointing German factory orders shows...