Tag Archive: #GBP

FX Daily, August 09: North Korea lets EUR/CHF Collapse

The bellicose rhetoric from the US and North Korean officials is the main driver today. We would qualify that assessment by noting that first, the market moves are rather modest, suggesting a low-level anxiety among investors. Second, pre-existing trends have mostly been extended. Turning to Asia first, the Korea's equity market fell 1.1%. The Kospi has fallen for the past two weeks (~2.2%).

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FX Daily, August 07: Outlaw Mondays

The US dollar is narrowly mixed to start the new week. Two main developments stand out. First, the dollar-bloc currencies are trading heavily. The Australian dollar is pushing lower for the fifth consecutive session. The greenback is advancing against the Canadian dollar for the sixth consecutive session. The New Zealand dollar is weaker for the fifth time in six sessions.

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Bank of England Crushes Sterling

Sterling reached a new 11-month high against the dollar earlier today, but the dovish take away from the Bank of England has seen sterling reverse lower. It has now fallen below the previous day's low, and a close below there (~$1.3190) would confirm the bearish key reversal pattern. Support near the week's low just below $1.3100 is holding, and if that goes, the $1.30 level can be tested. A break of $1.2930, the low from the second half of July...

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FX Daily, August 03: Dollar-Bloc Currencies Turning, but Euro Downticks Limited

The high-flying dollar-bloc currencies may be a preliminary sign market change. The US dollar is gaining on the Canadian dollar for the fourth consecutive session. It is probing resistance we identified in the $1.2620 area. The US dollar has not traded above its 20-day moving average since the Fed hiked rates on June 14. It is found today near CAD1.2625.

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FX Daily, August 02: Euro Climbs Relentlessly, While Greenback is Mixed

The euro's strength is surely partly a reflection of US dollar weakness, but it is also a reflection of the improved sentiment among investors. The initial dollar losses at the start of the year was largely a correction that is common after a Fed hike. This is more or less what happened at the start of 2016 as well, following the Fed hike in December 2015.

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FX Daily, July 31: Monday Morning Blues

The euro is up by 0.15% to 1.1385 CHF. The US dollar is enjoying a respite from the recent selling, but its gains have been shallow, and will likely prove brief. The upticks have been concentrated in the recently high-flying dollar-bloc currencies, and sterling. The tone appears to be more consolidative than corrective, and month-end adjustment provides an additional wrinkle.

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FX Weekly Preview: The Dollar may Need more than a Strong Employment Report

For the US jobs data to rally the dollar, it needs to increase the likelihood of a Fed hike in September, a high bar. The BOE will stand pat, a 6-2 vote would likely be accompanied by a hawkish inflation report. The RBA will also hold rates steady, and of course, it would prefer a weaker currency.

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Dollar View: Discipline or Stubbornness

Fundamental driver, divergence is still intact. The dollar's losses have barely met the minimum retracements of a bull market. Sentiment may be exaggerating the positive developments in Europe and the negative developments in the US.

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FOMC Sticks to Script: Balance Sheet Unwind to Begin “Relatively Soon” and USD Retreats

Little new in FOMC statement. Seems consistent with a Sept announcement to begin reducing the balance sheet in Oct. USD sold off as if reflecting sentiment held in bay until the statement was out of the way.

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FX Daily, July 26: Quiet Fed Day without Yellen

By definition, the Federal Reserve Open Market Committee meeting is the highlight of the day. Without a press conference, and following last month's rate hike, there is practically no chance of a new policy initiative either on the balance sheet or the Fed funds target.

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FX Daily, July 25: Summer Markets Ahead of FOMC

The global capital markets are subdued today; a dearth of fresh news and tomorrow's FOMC meeting are making for light activity and limited price movement. The US dollar is little changed against most of the major currencies. The net change on the day through most of the European morning is +/- 0.15%. The exception is the Norwegian krone and Swedish krona, which is about 0.25% stronger.

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FX Daily, July 24: Euro Recovers from Softer Flash PMI

The euro made a marginal new high in early Asia, but participants rightly drew cautious ahead of the flash eurozone PMI. The flash PMI was softer than expected, and although the composite fell to six monthly lows, it is more a reflection of how steady it has been at elevated levels.

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FX Weekly Preview: Don’t Be Confused by the Facts or Why Neither the Data nor the Fed Will Alter Market Trends

FOMC is the highlight of the week. Early look at July inflation in Europe may see less pressure. Overall household consumption in Japan is rising, helped by robust labor market, but little new price pressures. The data this week is expected to confirm what many investors have come to assume.

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FX Daily, July 21: Dollar Licks Wounds as News Stream Doesn’t Improve

The euro has depreciated by 0.13 to 1.1043 CHF. ECB President Draghi did not argue forcefully enough at yesterday's press conference to dampen the enthusiasm for the euro. The initial dip was quickly bought and the euro chased above last year's high near $1.1615, and the gains have been extended to nearly $1.1680 today. The next target is the August 2015  near $1.1715 is near.

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FX Daily, July 19: Dollar Stabilizes on Hump Day, Awaits Thursday’s BOJ and ECB Meetings

After being shellacked to start the week, the US dollar is being given a small reprieve today as investors await tomorrow's BOJ and ECB meetings. The US may also report a bounce back in housing starts (residential investment) after a three-month slide.

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Sterling, McCafferty, and BOE Policy

BOE hawk is arguing for a sooner unwind of QE. He did not favor the renewed asset purchases after the referendum. Sterling has been meeting resistance near $1.30 for past two months.

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FX Weekly Preview: Focus Shifts from Fed to ECB

Market has downgraded chances of a September hike from low to lower, but the chances of a December hike are higher than the day after the June hike. ECB meeting is the most important event of the week. A small change in the risk assessment is likely. The US and Europe have been more disruptive to the global capital markets this year than China.

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FX Daily, July 14: Aussie Scales New Highs for the Year, as the Greenback Remains on the Defensive

The Australian dollar has taken over leadership in the dollar bloc from the Canadian dollar. The Aussies are up about 0.35% today to extend this week's gains to more than 2% and reach a new high for the year a little more than $0.7760. The Canadian dollar is up 1.1% this week, in comparison.

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