Weekly Market Update
The significant positive surprise in US inflation numbers for June sent financial markets roaring higher on expectations that the Federal Reserve is very close to ending its rate hike cycle. US rates dropped sharply, hikes beyond July were priced out, and unsurprisingly the dollar lost ground against every major currency worldwide, as investors cheered and […]
Weekly Market Update
A spate of US labour market reports came out a touch softer than expected last week, culminating in the headline payrolls number for June. The data cannot be described as weak, and in fact US yields continued to head higher throughout the week, but FX markets took it as a sign that the recent dollar […]
Weekly Market Update
Currencies trade in tight ranges as central banks hint at further tightening. G10 currencies all ended the week within less than 1% of where they had started it. Rates continued to rise in the main economic areas, as central bankers at the ECB’s Sintra conference generally delivered a hawkish message and core inflation remains stubbornly […]
Weekly Market Update
Risk assets struggled all last week as global economic sentiment took a turn for the worse. The PMIs of business activity, perhaps the most timely indicator of economic activity, surprised to the downside, particularly in the Eurozone, reviving recession fears. The dollar generally benefits from uncertainty and flight from risk, and last week was no […]
Weekly Market Update
Both the Federal Reserve and the ECB struck hawkish surprises last week. However, the latter hiked rates while the former did not, and markets chose to believe facts, rather than rhetoric. The dollar sold-off sharply against every major currency in the world, with the expectation of the Japanese yen, hurt by the Bank of Japan’s […]
Weekly Market Update
The dollar struggled in lackluster trading last week, as the rebound in commodity prices and improving investor sentiment meant the main 2023 trends continue to drive markets: a soft dollar, and a particularly strong showing by commodity currencies. Latin American currencies continue to shine, and at the other end, we have the Turkish lira, spiralling […]
Weekly Market Update
While the euro, dollar and sterling fail to move much against one another, emerging market currencies once again took the spotlight last week. Latin American currencies in particular built further on their torrid performance so far in 2023, buoyed by the return of risk appetite to financial markets, which is lifting risky assets generally. News […]
Weekly Market Update
The resilience of the US economy continues to confound expectations. It is weathering well the rate increases so far, and optimism has grown further now both the banking crisis and the debt ceiling impasse are receding. The incipient signs of labour market easing have not panned out, and income, spending and (unfortunately) price pressures continue […]
Weekly Market Update
The US dollar was once again broadly stronger last week, ending it modestly higher against most of its major counterparts. We contested that the move upwards in the greenback in the week previous was likely driven by nothing more than stretched investor positioning and profit taking. The catalysts behind the rally last week were far […]
Weekly Market Update
The sharp move upward in the US dollar last week was somewhat counterintuitive, as inflation and wage data out of the US were both reassuring for the Federal Reserve and consistent with a slow downward trend in inflationary pressures. The main suspect is likely to be market positioning. After the relentless move from below parity […]