Weekly Market Update
Last week saw volatile trading in currency markets without the emergence of any clear trend. Sterling was the week’s winner, as markets ignored weakness in UK retail sales, while the yen underperformed all other G10 currencies when the Bank of Japan kept its ultra-loose yield curve management policy intact at its January meeting. Emerging markets […]
Weekly Market Update
Last week’s US inflation report confirmed the downward trend in price pressures and sent financial markets worldwide soaring on the hope that Fed hikes will soon stop. 2023 has gotten off to a very optimistic start, as the good news on inflation are added to fading fears of a European recession and the Chinese post-COVID […]
Weekly Market Update
Last week brought some relief on the inflation front on both sides of the Atlantic. In Europe, energy prices fell more than expected in December. In the US, wage increases appeared to moderate. In response, interest rates fell, and risk assets started the year on the right foot, rallying across the board. G10 currencies were […]
Weekly Market Update
We’d been warning for some time about the large gap between market expectations for future ECB rates and the inflationary reality. The central bank swung clearly to our view at its meeting last week, warning of 50bp hikes for as long as is necessary and forcing European rates higher across the curve. The Federal Reserve […]
Weekly Market Update
Last week’s currency rankings had an unusual couple on top: the Chinese yuan and the Swiss franc. The former was buoyed by the increasing signs that China is moving away from its zero-covid lockdown policy, whereas the latter appears to have finally caught a break after a few weeks of improving risk sentiment, as traders […]
Weekly Market Update
A relatively dovish speech from Fed chair Powell, and the prospect of a pivot away from zero-COVID in China, put some fuel into the risk asset rally last week. The US dollar was once again one of the worst performing currencies in the world, having suffered its worst monthly performance since September 2010 in November, […]
Weekly Market Update
Risk assets rose worldwide last week as the backdrop turned more supportive. Recession fears seem to be easing worldwide, particularly in the Eurozone, but interest rates are not rising in tandem, the best combination possible for stock markets, credit, and commodity currencies. The dollar underperformed against every currency in G10, and the biggest winners were […]
Weekly Market Update
The news that markets had been desperately hoping for finally arrived last week. Inflation in the US came out lower than expected, US rates dropped the most since the pandemic era and risk assets worldwide soared in jubilation. The dollar experienced one of the sharpest two-day falls in history, falling anywhere from nearly 6% (against […]
Weekly Market Update
Currency market volatility continues to rise, and signs are emerging that the dollar rally is running out of steam. The Federal Reserve delivered a massive hike and a more hawkish than expected message, while other central banks begin to fret about the impact of higher rates on their respective economies. However, the dollar failed to […]
Weekly Market Update
Risk assets were steady to higher worldwide last week, as markets price in a modestly lower terminal rate from central banks and yields fall. Markets seem to be giving UK Prime Minister Sunak the benefit of the doubt on his promises to stabilise government finances, and the pound outperformed all its G10 peers to end […]