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Tag Archives: EUR

The Dollar, Stocks, and Bonds are on the Move: What do the Charts Say?

The dollar rose against nearly all the currencies last week.  Among the majors, the chief exception was the Japanese yen, which seemed to benefit from the equity weakness and the drop in yields, perhaps not really so much of the widely touted safe haven attribute, but the unwinding of funding positions.  The main exception among emerging market currencies was the Indian rupee, which moved into the upper end of its three-month trading range as tensions with Pakistan appeared...

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Brexit Comes to a Head, and while Europe and US Data Rebound, the Equity Rally Falters

Brexit comes to a head.  By nearly all reckoning, the Withdrawal Bill will be resoundingly defeated in the House of Commons on March 12.  The margin of defeat may not match the first rejection, but it will be the death knell to the path that had been negotiated for a year and a half.  On March 13, the House of Commons will vote on leaving the EU without a withdrawal agreement.  Most, except the most extreme partisans, think that such an act would result in a dramatic...

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Equities Slump on Growth Concerns ahead of US Jobs

Overview:   A weak economic assessment in the Beige Book and an ECB that slashed growth forecasts have been followed by news of a nearly 21% slump in China's exports have marked the end of the dramatic equity rally that was seen in the first part of 2019 after the sharp losses late last year.   The Shanghai Composite dropped 4.4%, the largest fall in six months, ending the eight-week rally with a 0.8% decline.  All the markets in Asia were lower.  It is the second...

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EMU Looks to ECB

Overview:  The ECB meeting is today's highlight.  A dovish signal is expected. The euro remains pinned near its lows ahead it.  The global equity market rally in January and February is faltering this week.  Asian equities were mixed, but the Nikkei eased for the third consecutive session.  Although the Shanghai and Shenzhen Composites eked out small gains, the CSI 300 tumbled more than 1% to nearly halve this week's gains.  Europe's Dow Jones Stoxx 600 is trading lower for...

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The Dollar Index Extends Gains into the Sixth Consecutive Session

Overview:  The capital markets are on edge.  The week's big events lie ahead.  The Bank of Canada meets today and the ECB tomorrow, followed by US (and Canada) employment data on Friday.  The equity markets are mixed.  While Japan and Korean equities eased, China's markets continue their tear.  The Shanghai Composite rose 1.5%, the fourth consecutive advance, and closing in on its ninth weekly rise.  Yes, it has risen every week this year.  European stocks are narrowly...

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Thoughts about the ECB and Euro

Mario Draghi's term at the helm of the ECB is winding down.  He will step down in October.  It has not been an easy job.  The light at the end of the tunnel in 2017 turned out to be another train in 2018.  The eurozone enjoyed 0.7% quarterly growth every quarter in 2017.  The ECB was able to outline an exit from its asset purchases.  The debate began over sequencing and when the first rate hike could be delivered.   But alas, the cyclical recovery fizzled and in the...

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Dollar Remains Firms as China Cuts Growth Target and Taxes, while EMU PMI Surprises on Upside

Overview:  It is an eventful day, but the capital markets are taking it in stride.  Equity markets are mixed.  Asia may have been weighed down by China's shaving its growth target and announced around CNY2 trillion (~$300 bln) in tax cuts to support the economy, though Chinese stocks edged higher.  India was the other major market to rise in Asia and this despite the US giving 60-day notice that its preferential trade treatment would end due to the lack of sufficient...

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March Monthly

The dollar rose against most of the major and volatile emerging markets currencies, like the South African rand, Turkish lira, and the Brazilian real in February.  The gains were mostly by default as concerns about the strength of the US economy continued to linger.  The weakness abroad, especially in Europe, seemed more profound.  Trade tensions ebbed as investors correctly anticipated an extension of the US-Chinese trade freeze, while the beginning of the EU-Japan trade...

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Markets Shrug-Off Trump’s Attempt to Talk the Dollar Down

Overview:  Comments by US President Trump over the weekend, complaining about the dollar's strength weighed on the greenback initially in Asia, but it quickly recovered.  Reports of progress on a US-China trade deal helped lift the Shanghai Composite above the 3000-level for the first time since the middle of last year. Asian equities mostly rallied with China.  Korea and Taiwan were notable exceptions after disappointing PMI data.  European shares are moving higher, and...

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A Look at the Charts

The US dollar was mixed against the major currencies last week.  The dollar-bloc currencies and the Japanese yen fell,  while the other major currencies rose, led by sterling (1.1%) on ideas that the risk of a no-deal Brexit was diminished, and the Swedish krona (0.9%) that was bolstered by 1.2% growth in Q4, quarter-over-quarter (around twice what economists expected). Dollar Index:  The Dollar Index rose in February by nearly what it lost in January, leaving it little...

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