Category Archive: 4) FX Trends

Main Author Marc Chandler
Marc Chandler
He is Global Head of Currency Strategy of Brown Brothers Harriman (BBH). He has been covering the global capital markets in one fashion or another for 25 years, working at economic consulting firms and global investment banks. He regularly appears on CNBC and has spoken for the Foreign Policy Association. In addition to being quoted in the financial press daily, Chandler has been published in the Financial Times, Foreign Affairs, and the Washington Post. BBH provides specialist services and innovative solutions to many Swiss asset managers that include a global custody network of close to 100 markets, accounting, administration, securities lending, foreign exchange, cash management and brokerage services. Feel free to contact the Zurich office of BBH

FX Daily, June 22: BOE Spurs Dollar Pullback

The Bank of England's hawkish hold yesterday, spurred by three dissents in favor of an immediate hike, changed the near-term dynamics in the foreign exchange market.  Both the euro and sterling fell to new lows for the year before reversing higher.  Yesterday's gains are being extended today. 

Read More »

FX Daily, June 21: Dollar Driven Higher

The half-hearted and shallow attempts by the currencies to recover appear to be emboldening the dollar bulls today,  The greenback is higher against all major and emerging market currencies today.  Demand for dollars is strong enough to offset the broader risk-off environment that is pulling stocks and core yields lower that is usually supportive of the yen. 

Read More »

FX Daily, June 20: Fragile Stability

The day began out with equity losses in Asia before a sharp recovery, perhaps initiated in China. The MSCI Asia Pacific Index was up a little more than 0.5%. The Shanghai Composite fell more than 1% before closing 0.25% better.

Read More »

FX Daily, June 19: America First Clashes With Made in China 2025

The escalation of trade tensions between the world's two largest economies is scaring investors, who are liquidating equities and buying core bonds.  The dollar and yen are the strongest of the major currencies.  The Swiss franc is mostly steady as it too is benefiting from the unwinding of risk trades.

Read More »

FX Daily, June 18: Politics and Economics Weigh on European Currencies

The US dollar is rising against most of the major and emerging market currencies. The prospects of escalating trade tensions and the divergence of policy that was confirmed by the major central banks are disrupting the markets. Norway's central bank meets later this week.

Read More »

FX Weekly Preview Warning: Treacherous Week Ahead

All three of the major central banks met last week and confirmed that monetary policy would continue to diverge for at least another year. The clarity of the trajectory of monetary policy reduces the impact of high-frequency economic data.

Read More »

FX Daily, June 15: Dollar Slips While Escalating Trade Tensions may Roil Markets

The Dollar Index edged higher to its best level this year before turning down as market attention shifts from central banks to trade tensions. Reports confirm that the US will go ahead with the 25% tariff on $50 bln of Chinese goods and provide some specificity today. The final list is expected to be similar to the goods that had been identified in the preliminary list, with an emphasis on electronic goods, apparently on ideas that they may have...

Read More »

FX Daily, June 14: Dollar Punished Ahead of ECB

The US dollar is slumping against all the major currencies in the aftermath of the hawkish Federal Reserve. In fact, the inability of the greenback to hold on to the gains scored in the initial reaction to the Fed's hike, optimism on the economy, and the signal of hikes in September and December, foretold today's push lower.

Read More »

FX Daily, June 13: Dollar Edges Higher Ahead of FOMC

The US dollar is trading firmly as the FOMC decision looms. In many ways, the actionable outcome of this meeting has hardly been in doubt this year. By all accounts, the Fed will deliver its second hike of the year today.

Read More »

FX Daily, June 12: US-Korea Summit Fails to Impress Investors

The US dollar initially rallied in early Asia ahead of the US-North Korea summit but has subsequently shed the gains and more. As North American dealers return to their desks, the dollar is lower against nearly all the major currencies, but the yen and Canadian dollar. 

Read More »

FX Weekly Preview: Busy Week Ahead

The week ahead is eventful. The Federal Reserve, the European Central Bank, and the Bank of Japan hold policy meetings. This would make for a busy week by themselves, but there is more. Trade tensions are likely to escalate further, if the US, as scheduled provides a list of $50 bln of Chinese goods that will face another 25% tariff for intellectual property violations.

Read More »

Dollar and Yen Rise Amid Heightened Anxiety

With what promises to be an acrimonious G7 meeting, from which the isolated US President will depart early, and a broadening pressure in emerging markets, the US dollar turned better bid late yesterday and is recovering further today.

Read More »

Greenback Corrects Lower

The consensus narrative is that with rising inflation it is understandable that next week's meeting is live and that the confirmation of such has lifted the euro to ten-day highs, dragging the dollar broadly.  However, to accept this is to accept the debasement of language.  Until now, we dubbed central bank meeting that could result in action as "live."  For example, given that the Fed has not changed interest rates since the hiking cycle began in...

Read More »

More Color on Japanese Capital Flows and the Euro

The euro put in a low on May 29 a little above $1.15. That is nearly a 10.5 cent decline since the three-year high was set in mid-February. The thing that is difficult for investors and analysts to get their head around is that the speculators in the futures market, who as seen as proxies for trend-followers and momentum traders, continue to carry large euro exposure.

Read More »

Weekly Technical Analysis: 04/06/2018 – USD/CHF, EUR/JPY, GBP/USD, AUD/USD, WTI

The USDCHF pair managed to break 0.9850 level and closed the daily candlestick below it, which supports the continuation of our bearish overview efficiently in the upcoming period, paving the way to head towards 0.9723 level as a next station, noting that the EMA50 supports the expected decline, which will remain valid for today conditioned by the price stability below 0.9870.

Read More »

FX Daily, June 5: Sterling Jumps Ahead, While US Equities Have Small Coattails

The British pound is benefiting from the stronger than expected service and composite PMI readings, which among other things are serving as a distraction from the government's seemingly tortured approach to Brexit and the sales of part of its stake in RBS for a GBP2 bln loss.  Financials are a drag on the FTSE 100 today (~-0.5% while other major bourses are higher).

Read More »

FX Weekly Preview: Macro Matters Now, Just Not the Data

The main concerns of investors do not arise from the high-frequency data that are due in the coming days. Last week, the somewhat firmer than expected preliminary May CPI for the EMU failed to bolster the euro. The stronger than expected US jobs data, even if tipped by the President of the United States, and the pendulum of market sentiment swinging back in favor of two more Fed rate hikes this year did not trigger new dollar gains.

Read More »

Great Graphic: Euro Bulls Stir but Hardly Shaken

Euro has fallen 10.5 cents since mid-February. Net speculative longs in the futures market remain near record. Gross long euros have actually increased over the past month.

Read More »

FX Daily, June 01: Ironic Twists to End the Tumultuous Week

The week is ending quite a bit different than it began. The main banking concern is not in Italy but in German, where shares in Deutsche Bank shares fell to a record low yesterday, and S&P Global cut its credit rating one step to BBB+ (third-lowest investment grade).

Read More »

FX Daily, May 31: Don’t Confuse Calmer Markets with Resolution

The global capital markets that were in panic mode on Tuesday stabilized yesterday, and corrective forces have carried into today's activity. However, the underlying issues in Italy and Spain are hardly clarified in the past 48 hours. Moreover, the US push on trade is intensifying again.

Read More »