Wednesday , January 20 2021
Home / Tag Archives: Currency Movement

Tag Archives: Currency Movement

US is on Holiday, but the Dollar has Legs

 Overview: The new week has begun like last week ended.  Equities are a bit heavy.  The MSCI Asia Pacific Index fell for the second session, its first back-to-back loss since before Christmas.  China and Hong Kong were the notable exceptions, perhaps helped by stronger than expected GDP.  Europe's Dow Jones Stoxx 600, which fell 1% at the end of last week, is a little lower in turnover in the European morning.  US stocks won't trade today in the local sessions, but futures are a bit lower. ...

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Upside Dollar Correction Not Complete

Within the context of our medium-term dollar bearish outlook, we had been anticipating a countertrend dollar bounce.  It was to be fueled by short-covering as the adverse developments had been discounted, rate differentials were moving in the US favor, and the technical indicators were stretched.  When the dollar traded higher after the disappointing ADP estimate and the events in Washington, and again on the headline miss with the December non-farm payrolls, that lent credence to our call. ...

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The Greenback is Finishing the Week with a Firm Tone

Overview:  The US dollar is firm against most of the major and emerging market currencies today.  Among the majors, the Japanese yen and Swiss franc are resilient. For the week, sterling and the yen appear poised to eke out small gains, while the Scandi's are the weakest performers with around a 1% decline. The freely accessible emerging market currencies, like the South African rand, Turkish lira, and Mexican peso, are leading emerging market currencies lows.  Still, the JP Morgan Emerging...

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Markets are Subdued Despite Impeachment and Record Chinese Trade Surplus

Overview:  The capital markets are becalmed today. There does not appear to be much reaction to the news that the House of Representatives impeached President Trump an unprecedented second time with greater bipartisan support than previously (10 GOP voted with the Democratic majority).  Nor has there been a significant reaction to Italy's political turmoil, where a small but key minority party withdrew from the governing coalition.  Most Asia Pacific equity markets advanced, with China and...

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Markets Catch Collective Breath

Overview:  The capital markets were stabilizing today after dramatic moves yesterday. Equity markets are recovering, and the dollar is paring yesterday's gains.  Most equity markets in the Asia Pacific region rose, though Taiwan, South Korea, and Australia were notable exceptions.  Europe's Dow Jones Stoxx 600 is posting a small gain, which, if retained, would be the fifth gain in seven sessions.  US shares are higher after snapping a four-day advance yesterday.  Benchmark 10-year yields are...

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Greenback Extends Recovery

Overview: Julius Ceasar is said to have "crossed the Rubicon" on January 10, 49 BCE, taking the 13th Legion into Rome, defying orders from the Senate, and precipitating the Roman Civil War that marked the end of the republic and the birth of the empire.   Last week's events paled in comparison despite the US President urging his supporters to march on Washington and demonstrate its strength. It was the only way the "stolen" landslide election would be secured.  His personal lawyer called for...

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Can the Dollar Find Traction Even if the Employment Data Disappoint?

Overview: The global equity rally picked up this week as it closed in 2019.  The MSCI Asia Pacific Index gained today and is up in nine of the past 10 sessions.  It has fallen only in one week since the end of October.  South Korea's Kospi led today's advance with a nearly 4% rally on the back of talks that were later played down between Hyundai and Apple.  Europe's Dow Jones Stoxx 600 is at its best level today since last March and is posting gains for the fourth consecutive week.  US...

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Dollar Bounces after Insurrection Put Down

Overview:  After the National Guard were called to put down an insurrection in Washington, DC, the dollar is having its best day in around a week.  The euro's three-day rally has been halted even though German factory orders surprised on the upside.  The greenback is firmer against all the major and most of the emerging market currencies today.  Equities are moving higher.  All the markets in the Asia Pacific but Hong Kong rallied today after the 8-day advance stalled yesterday.  Hong Kong...

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High Drama Weighs on the Greenback and Lifts Yields

Overview:  One of the two Georgia Senate contests remains too close to call, but the market appears to be pricing in a Democrat sweep.  The 10-year yield has punched above 1% but has offered the greenback little support.  Yesterday, the dollar-bloc currencies rose to highs since early Q2 2018 and are extending those gains today.  The Scandis are also tracking higher.  The yen is the laggard, but the greenback remains below JPY103.00  Emerging market currencies have not been deterred by the...

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No Follow-Through Dollar Buying after Yesterday’s Recovery: Consolidative Session Likely

Overview: The poor price action in North America yesterday failed to spur much knock-on effect today.  That said, US participants may remain on edge as Georgia votes today which will greatly impact the shape of the Biden agenda.  The MSCI Asia Pacific Index extended its advance for an eighth consecutive session, and European shares are little changed, caught between rising energy and falling utilities.  US shares are firm.  Bond yields have edged up 1-2 bp in Europe and the US but were lower...

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