Category Archive for: Business

Post date: 18/10/2021 10:49 One of the key correlations beginning to establish itself in the post-pandemic world seems to be the negative one between US inflation and the dollar. Yet another strong CPI report showed headline inflation above 5% for the fifth consecutive month. Yields did not move much as a response, but the US…

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Post date: 11/10/2021 12:04 Last week provided strong validation for our view that inflationary pressures will be here for longer than G10 central banks expect. Oil prices, and the energy complex in general, rose strongly for the week, as did sovereign bond yields worldwide, driven higher by rising inflation expectations. For now, risk assets are…

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Post date: 04/10/2021 11:00 Last week’s theme in markets continues to be aligned with our views and forecasts: burgeoning inflationary pressures worldwide and the possibility that central bankers, particularly in the developed world, may be already behind the curve in tightening policy. This was particularly evident across Eastern Europe, where hawkish surprises in central bank…

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Post date: 27/09/2021 11:27 We have been pushing for a while the idea that currency markets will now be mostly, if not exclusively, about the relative pace of central bank policy tightening, with inflation data a close second. In line with this narrative, the Norwegian Krone was the week’s best performer on the back of…

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Post date: 20/09/2021 11:20 In a week when markets mostly marked time waiting for this week’s Federal Reserve September meeting, the main news was the relentless rise in energy prices, even as inflation data for August in the US came slightly softer than expected, and Eurozone inflation was confirmed at a 10-year high. The general…

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Post date: 13/09/2021 11:59 The stagflation concerns from the August payroll report in the US were confirmed by another labour market report (JOLTS), which showed unfilled job openings soaring to another all-time high in July. Yields continued to march higher worldwide, risk assets wobbled, and major currencies did not do much of anything, staying within…

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Post date: 06/09/2021 11:51 The Federal Reserve cannot be happy with the US payroll report for August. Weaker than expected employment growth shared the headlines with strong wage gains, suggesting that inflationary pressures will not be as transitory as it hopes. The US dollar promptly sold off even as US yields rose, a reversal of…

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Post date: 23/08/2021 11:51 Jitters about the possible impact of continued COVID restrictions worldwide favoured the dollar last week. The consensus seemed to be that the impact on growth expectations would be relatively more muted in the US than elsewhere, and the greenback benefitted from that and also a hawkish tone in the minutes of…

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Post date: 16/08/2021 13:19 A downward surprise in US consumer expectations would normally be shrugged off by financial markets. However, thin August trading meant that this second-tier data print late-Friday had an outsized impact on markets that had mostly ignored the much more critical CPI print a couple of days earlier. US rates gave up…

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Post date: 09/08/2021 11:54 Going into the key Friday payrolls report last week, currencies traded with typical summer torpor, as many decision makers in trading floors are on vacation and critical news was scarce. All changed on Friday afternoon after a stellar jobs report out of the US provided evidence that the US economic recovery…

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