Category Archive: 4.) Marc to Market

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FX Daily, June 27: Euro Surges on Draghi, While Yuan Rises on Suspected PBOC Action

2017-06-27

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2017-06-27

ECB President Draghi told the audience at the annual ECB Forum transitory factors were holding back inflation. This was quickly understood to be bullish for the euro, and it rallied from near the session lows below $1.12 to around $1.1260, a nine-day high.

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FX Daily, June 26: Italian Markets Shrug off Banking Morass and Local Election Results

2017-06-26

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2017-06-26

The US dollar is mostly slightly firmer as North American dealers return to their posts. Ideas that the UK Tories are getting close to a deal with the DUP appears to be lending sterling a modicum of support, as it tries to extend its uptrend into a fourth session. The Japanese yen is the weakest of the majors, rising equities, and yields, spurs the dollar to re-challenge last week's high near JPY111.80.

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FX Weekly Preview: Drivers A Couple Things that Aren’t on Your Economic Calendar

2017-06-26

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2017-06-26

Fed, ECB and BOJ preferred inflation measures will be reported, but are unlikely to change views. Canada's Survey of Senior Loan Officers may be more important than April GDP. US healthcare bill in the Senate and likely action on steel could be the most significant events in the week ahead.

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Short Summary Weekly MOF Portfolio Flows

2017-06-25

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2017-06-25

Japanese investors bought the third largest amount of foreign bonds this year last week, but still not enough to offset sales in first part of the year. Japanese investors are buying around the same amount of foreign equities as last year. Foreign investors are buying more Japanese stocks and bonds than they did on average last year.

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Bond Yields, Inflation, and More

2017-06-24

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2017-06-24

Falling oil prices pushing down inflation expectations and lowering bond yields is the conventional narrative. It ignores that survey-based measures of inflation expectations are stable. It ignores a host of other demand factors.

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FX Daily, June 23: Dollar Pares Gains Ahead of the Weekend

2017-06-23

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2017-06-23

The US dollar is trading lower against all the major currencies today, which pares its earlier gains. The greenback is holding on to small gains for the week against most of them, except the New Zealand dollar, Swiss franc and Norwegian krone.

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Great Graphic: Fed, ECB, and BOJ Balance Sheets

2017-06-23

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2017-06-23

This Great Graphic composed on Bloomberg shows the balance sheets of the Federal Reserve, the European Central Bank, and the Bank of Japan as a proportion of GDP.

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FX Daily, June 22: Greenback Goes Nowhere Quickly, While Yen Remains Bid

2017-06-22

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2017-06-22

The summer doldrums begin early. The US dollar is little changed against most of the major currencies. Bond yields are mostly one-two basis points lower, and equity markets are mixed but with a downside bias. Oil prices slump more than 2% on Tuesday and again on Wednesday. This is weighing on bond yields and equities.

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Great Graphic: Selected GDP Performance since 2008 and Policy

2017-06-22

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2017-06-22

This Great Graphic was tweeted by Martin Beck, and it comes from Oxford Economics, using Haver Analytics database. It shows the relative economic growth since 2008 for the US, UK, Japan, and EMU.

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FX Daily, June 21: Heavy Oil Weighs on Yields and Lifts Yen

2017-06-21

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2017-06-21

The US dollar is narrowly mixed against the major currencies. The drop in oil prices (3.3% this week) is seen as one of the factors that may be underpinning the appetite for fixed income, and this, in turn, is lifting the yen. The greenback had approached JPY112 yesterday, but with the drop in oil prices and yields has seen it retreat toward JPY111.00.

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FX Daily, June 19: Dollar Mixed while Equities Recover to Start Eventful Week

2017-06-19

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2017-06-19

The US dollar is mixed against the major currencies, and while it is firmer against the euro and yen, it is within last week's ranges. The success of Macron's new party in France, and the majority is secured, was well anticipated by investors and is having little effect on today's activity in the capital markets.

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FX Weekly Preview: Events Not Data Key in Week Ahead

2017-06-19

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2017-06-19

Light economic data calendar, but look for downtick in eurozone flash PMI. Soft Canadian retail sales (volume) and softer CPI (base effect) could take some of the sting from the recent BoC official comments. MSCI decision on China, Argentina, Saudi Arabia, and South Korea may have the broadest and long-lasting impact of the five key events we highlight.

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Great Graphic: Value vs Growth

2017-06-17

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2017-06-17

Performance of Growth and Value Stocks Compared
This Great Graphic, created on Bloomberg show the performance of growth and value stocks since the start of December 2016. The yellow line is the Russell 1000 Growth Index. The white line is the Russell 1000 Value Index. The outperformance of the former is clear.

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FX Daily, June 16: Dollar Slips In Consolidation, but Extends Recovery Against the Yen

2017-06-16

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2017-06-16

As the market heads into the weekend, the US dollar is trading softer as it consolidates. It is within yesterday's ranges against the major currencies but the Japanese yen. The dollar has made a dramatic recovery against the yen. It traded near JPY108.80 in the middle of the week and pushed through JPY111 in late in the Tokyo morning. The greenback is above its 20-day moving average against the yen for the first time in a month.

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Great Graphic: Sticky Pass Through

2017-06-16

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2017-06-16

This Great Graphic was posted by Steve Goldstein at MarketWatch. The blue line shows the effective Fed funds rate. The orange line depicts the average interest rate on a $10,000 one-year CD.

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FX Daily, June 15: Dollar Trades Higher in Wake of the FOMC

2017-06-15

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2017-06-15

The US dollar gains scored yesterday in response to what appeared to be a more hawkish FOMC than expected have been extended today. The euro and the Swiss franc have recorded new lows for the month.

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FX Daily, June 14: FOMC and upcoming SNB

2017-06-14

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2017-06-14

The Euro has risen by 0.37% to 1.0901 CHF. This is a typical movement ahead of the SNB meeting tomorrow. This movement is probably unrelated to the Fed rate hike, given that the USD/JPY has fallen. It makes sense to go long CHF against JPY, if you bet on an inactive SNB. Inactive SNB would mean that the central bank will not speak about stronger FX Interventions or about lower rates.

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FX Daily, June 13: Dollar Softens Ahead of Start of FOMC Meeting

2017-06-13

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2017-06-13

The US dollar is trading with a heavier bias against all the major currencies save the Japanese yen. The Scandis and Canadian dollar are leading the move. Sweden reported a 0.1% rise in the headline and underlying inflation while the median expected a decline of the same magnitude. The year-over-year pace slowed but not as much as expected.

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FX Daily, June 12: Ahead of Central Bank Meetings, Politics Dominates

2017-06-12

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2017-06-12

The US dollar is trading within its pre-weekend range against the major currencies as participants await the central bank meeting starting in the middle of the week. The Federal Reserve, Bank of England, and the Bank of Japan meet.

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