Tag Archives: U.K.

Overview: A surprise cut in China's seven-day repo and a stronger than expected UK employment report are session's highlights ahead of the US CPI. The base effect alone suggests a sharp fall in the year-over-year rate, while the median forecast in Bloomberg's survey has been shaved to a 0.1% month-over-month gain. The dollar is under pressure and is weaker against nearly all the G10 currencies. It is mixed against the emerging market currencies. The dollar gapped...

Overview: Today may be the calm ahead of a tomorrow's US CPI and rate decisions by the Fed, ECB, BOJ, and PBOC over the next few days. Most large bourses in the Asia Pacific region rose and Europe's Stoxx 600 is snapping a three-day decline. US index futures are trading higher. US 10-year yield is slightly firmer as are core European benchmark yields. The dollar is under broad pressure and is weaker against the G10 currencies. Against emerging market currencies, it...

Overview: The market was gearing up for a June Fed hike and officials and this helped lift the greenback. However, the Fed Governor Jefferson, nominated to be the next vice-chair, pushed back against it. His views are thought to reflect the Fed's leadership. Philadelphia Fed's Harker, who is a voting member of the FOMC also backed a pause. This is not quite what we expected when we suggested the US interest rate adjustment was complete or nearly so. Still, it broke...

 Overview: Yesterday's dollar surge has stalled. It is consolidating its gains and is softer against all the G10 currencies. After popping above JPY140 yesterday, there were no follow-through greenback buying in Tokyo. Most emerging market currencies are also firmer, including the South African rand, which plummeted by 2.8% yesterday on the back of the central bank's warning of downside currency risks as it delivered a 50 bp hike. The Chinese yuan is also firmer to...

Overview: Concerned about the political wrangling over servicing US debt, Fitch put the US on negative credit watch. Besides chin wagging and finger pointing, it has had little perceptible impact. The dollar is mostly higher, reaching new highs for the year against the Japanese yen, Chinese yuan, and the Antipodean currencies. The euro and sterling met retracement objective we have targeted (~$1.0735 and $1.2435, respectively). The greenback is also firmer against...

Overview: Equities in the Asia Pacific region and Europe are being led lower by the sell-off in the US yesterday. All the large Asia Pacific markets fell with Hong Kong and mainland shares setting the pace. Europe's Stoxx 600 is off nearly 1.5%, which would be the largest loss in two months. Consumer discretionary, financials and real estate sectors are off nearly 2%. US equity futures have a softer bias. European 10-year yields are mostly 2-3 bp lower, but the UK...

Overview:  The dollar is bid. Only the Japanese yen is holding its own against the greenback but only after it fell to new lows for the year. The Scandis and Antipodeans are the heaviest among the G10 currencies, while sterling has fallen to a new low for the month. The prospect of a rate hike tomorrow has not protected the New Zealand dollar much and it is off nearly 0.5%. Emerging market currencies are more mixed. Outside of the Russian rouble, the South Korean...

Overview:  The US debt ceiling talks resume at the White House today but a deal is unlikely to be announced. President Biden will attend the G7 summit in Hiroshima with the debt ceiling still looming. The dollar is mostly softer as last week's gains are pared. The Swiss franc and Japanese are the strongest in the G10. The Thai baht and South African rand, among the market's favorites yesterday are seeing those gains retraced. The JP Morgan Emerging Market Currency...

Overview: The dollar sprang higher yesterday but follow-through buying today has been limited. The little more than 0.5% gain in the Dollar Index was among the largest since mid-March. And yet, the debt ceiling anxiety and weak US bank shares persist. Today's talks at the White House have been postponed until early next week. Both sides are incentivized to bring it to the brink to demonstrate to their constituencies that they got the best deal possible. Both the...

Overview: There is a nervousness that hangs over the capital markets. Although US banks shares recovered at the end of last week, many continue to see the sector’s challenges as the harbinger of a dramatic reversal in the Fed’s stance. America’s debt ceiling looms large and could be a few weeks away. China led Asia Pacific bourses higher, and, ironically, its bank shares extended their rally. Japan, returning from last week’s holiday was notable exception. Relative...