Tag Archive: $CAD

FX Daily, December 03: G20 Fan Animal Spirits

2018-12-03

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2018-12-03

The US and China kept their trade guns cocked at each other but offered the last opportunity for a negotiated settlement before escalation. What is billed as a 90-day freeze on tariff increases is really only 60 days beyond January 1 when Trump had threatened to increase the 10% tariff on $200 bln of Chinese goods to 25%.

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FX Weekly Preview: Dramatic Week Ends with Whimper?

2018-12-03

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2018-12-03

There is an eerie calm in the capital markets today as the G20 meeting gets underway. There is much uncertainty, and the event calendar is chock full next week, with the Brexit debate getting underway in the UK Parliament, the CDU picks a new leader to replace Merkel, possible partial US government closure, Powell's testimony before Congress, OPEC+ meeting, and US employment data.

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FX Daily, November 29: Reluctant to Extend Dollar Losses

2018-11-29

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2018-11-29

Overview: The biggest US equity advance since Q1 has helped lift global markets today. The MSCI Asia Pacific Index rose for the fourth session, and nearly all the bourses in the region rallied with the notable exception of China and Hong Kong. Almost all the sectors in Europe are rallying but energy and real estate. US oil inventories rose three times more than expected and Putin expressed little support for fresh output cuts.

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Near-term Outlook

2018-11-27

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2018-11-27

There are three key scheduled events between now and the end of the year.  In chronological order, this weekend G20 meeting is first.  It will shape expectations for trade tensions between the US and China, with extensive secondary impact. Saudi Arabia and Russia's meeting may help shape expectations for the price of oil, which has collapsed here in Q4 18.

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FX Daily, November 23: Friday

2018-11-23

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2018-11-23

The US dollar is firmer against most of the major currencies. Japanese and Indian markets were closed for holidays and a weaker than expected flash EMU PMI helped keep the euro pinned near this week's lows. Although the EU seemed to thrown UK's embattled May a lifeline with some compromise wording in a draft declaration, the challenge remains the same--Parliament's approval.

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FX Daily, November 21: A Semblance of Stability Returns

2018-11-21

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2018-11-21

Yesterday's frenzy has burnt itself out for the moment. Equities began recovering in Asia after early losses. China, including Hong Kong, Singapore, and Thailand closed higher and European markets are recouping some of yesterday's decline. The Dow Jones Stoxx is trying to snap a five-day decline and is up a little more than 0.5% near midday.

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FX Daily, November 20: Equity Slide Continues

2018-11-20

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2018-11-20

Yesterday's 3% drop in the NASDAQ is setting the tone for today. The US stock market advance had been led by a narrow group of equities, and those have come under strong pressure amid slower consumer demand and stricter export control. Asian equities were a sea of red today. Chinese markets led the sell-off with more than a 2% drop. In Europe, the Dow Jones Stoxx 600 is for a fifth session. 

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Cheat Sheet

2018-11-20

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2018-11-20

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The market always has taken the Fed's forecast for three rate hikes next year with a large dose of skepticism. The fed funds futures strip implies growing expectations that the Fed pauses after a hike in December and Q1 19. It is still unclear the direction of fiscal policy next year. It may be difficult for the Democrats to oppose making middle-class tax cuts permanent and an infrastructure initiative cannot be ruled out.

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FX Daily, November 19: Does Monday’s Calm mean a Storm is Around the Corner?

2018-11-19

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2018-11-19

Overview: There is an uneasy calm in the global capital markets. Investors are digesting the weekend news, which includes the failure of APEC to issue a joint statement due to US-China tensions that we highlighted by dueling speeches by China President Xi and US Vice President Pence.

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FX Daily, November 15: UK Political Drama Roils Sterling

2018-11-15

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2018-11-15

Overview: The resignation of the UK's Brexit negotiator after Prime Minister May had secured support from a majority of the cabinet sent sterling sharply lower.  Raab's resignation underscores the difficulty the Brexit agreement faces in the UK Parliament.  Sterling was hammered nearly 2.5 cents on the news and trade below $1.28.

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FX Daily, November 13: Weak Turn-Around Tuesday

2018-11-13

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2018-11-13

Overview:  The US dollar has a heavier bias against most of the major and emerging markets currencies, but the pullback is shallow, and the greenback's underlying strength is still evident.  Asian equities were mixed.  Concern that Apple may be reducing orders weighed on suppliers, but news that China and US trade talks are resuming boosted sentiment, allowing Chinese stocks to recover helped lift the Australian and New Zealand dollars.

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FX Daily, November 12: Sterling’s Losses Lead Dollar Rally

2018-11-12

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2018-11-12

Overview: The US dollar is enjoying broad gains against most major and emerging market currencies. Sterling, dragged down by Brexit concerns, is leading the way. With today's losses, sterling has shed nearly 3.7 cents over the last four sessions. The euro, for its part, is at a new 17-month low (~$1.1250). 

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FX Daily, November 09: Greenback Stabilizes at Higher Levels

2018-11-09

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2018-11-09

The US dollar's gains scored in the wake of the Fed's signal that will continue on course to gradually hike rates have been extended. Most emerging market currencies are lower as well.  Equity markets are heavy.  Bond yields in Europe and US are a little lower, with the exception of Italian bonds. 

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FX Daily, November 6: US Goes to the Polls

2018-11-06

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2018-11-06

Overview: The US dollar is narrowly mixed against the major currencies today, largely consolidating its recent losses. Equities are mixed.  In Asia, Japan, Australia, and Hong Kong equities gained around 1%, while most other bourses were softer.  In Europe, the Dow Jones Stoxx 600 is little changed in late morning turnover.

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FX Daily, November 01: Dollar Slumps to Start New Month

2018-11-01

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2018-11-01

Overview: It appears that month-end considerations deterred the dollar selling that the technical indicators warned was coming and as the new month starts, the dollar is offered. It is weaker against all the major currencies and most of the emerging market currencies.

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Cheat Sheet

2018-11-01

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2018-11-01

Jobs data ahead of the weekend should recover after a storm depressed the September jobs growth. The base effect will allow earnings to show a strong year-over-year gain. The FOMC meets next week. A 25 bp rate hike in December remains the most likely scenario despite the heightened volatility in the stock market.

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FX Daily, October 31: No Fright on This Halloween

2018-10-31

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2018-10-31

After sliding hard this month, equities continue to stabilize into month-end. All of the equity markets in Asia-Pacific rallied with the help of a solid close in the US. European bourses are higher too as the Dow Jones Stoxx 600 tries to extend the recovery for a third consecutive session, led by energy, materials, and information technology.

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FX Daily, October 29: Market Awaits US Leadership

2018-10-29

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2018-10-29

The Dollar index is trading within last Friday's trading ranges. The year's high, set on August 15, was just shy of 97.00. The euro continues to straddle the $1.14 level but is spending more time in Europe below there. There is a 1.5 bln euro option expiring today at $1.1350 and an almost 600 mln euro option at $1.1400 that will be cut.

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FX Daily, October 25: ECB Overshadowed by Equity Market Drama

2018-10-25

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2018-10-25

The Dollar Index broke above 96.00 yesterday and is consolidating today. Provided the 96.00 area holds, the next target is the year's high near 97.00. The euro has been confined to a little more than a quarter of a cent. Players seem reluctant to sell it below $1.14 and note there is a 570 mln euro option at $1.1420 that expires today.

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FX Daily, October 24: Disappointing Flash PMI Weighs on Euro

2018-10-24

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2018-10-24

The US dollar is firmer against the major currencies and most emerging market currencies.  While the seemingly fragile equity markets are still the center of investors' attention, the weakness of the eurozone flash PMI is disconcerting and has sent the euro closer to $1.14.  China's officials continue to unveil initiatives to minimize the disruption of the equity and debt markets while seemingly adding to moral hazard risks. 

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