Weekly Market Update
Safe havens suffer as optimism returns to market Typical market correlations broke down last week, after the forced merger of Credit Suisse with UBS had allayed European banking concerns only temporarily. The dollar fell against every major currency except the Japanese yen, as investors skewed safe havens and rediscovered their appetite for risk. As far […]
Weekly Market Update
Lingering bank concerns drive down yields and US dollar. Typical market correlations broke down last week, after the forced merger of Credit Suisse with UBS had allayed European banking concerns only temporarily. A ‘dovish hike’ from the Federal Reserve, and fears of a reduction in bank credit in the US, drove Treasury yields sharply lower. […]
Weekly Market Update
G10 currency trading was fairly uneventful last week, as the dollar had a mixed reaction to the relentless march higher in interest rates, as risk assets took it in stride. Emerging market currencies were the stars last week, led by the Latin American ones. The reopening of the Chinese economy after the end of COVID […]
Weekly Market Update
The recent rally in the US dollar eased against most major currencies last week, as markets somewhat tempered bets in favour of higher Federal Reserve rates. The week was mixed overall. The dollar rose against most emerging market currencies following the surge higher in US yields, although it ended lower against almost all of its […]
Weekly Market Update
The ‘big three’ central bank meetings came and went last week, rates were hiked in accordance to market expectations, and the market interpreted communications as generally dovish. However, in currency markets these announcements were overshadowed somewhat by the US labour market report for January, which blew away all expectations and sent interest rates and the […]
Weekly Market Update
Chinese authorities are suggesting that they intend to catch up with the time lost during the zero-COVID experiment by buoying consumption, and the direct beneficiaries of higher Chinese demand are celebrating. Commodity currencies, like the Australian, New Zealand and Canadian dollars were the best performing G10 currencies last week, while the rest of them traded […]
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 […]