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Category Archive: 4) FX Trends

Main Author Marc Chandler
Marc Chandler
He has been covering the global capital markets in one fashion or another for more than 30 years, working at economic consulting firms and global investment banks. After 14 years as the global head of currency strategy for Brown Brothers Harriman, Chandler joined Bannockburn Global Forex, as a managing partner and chief markets strategist as of October 1, 2018.
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Big Week Begins Slowly

2021-10-25

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2021-10-25

Overview:  The global capital markets give little indication of the important economic and earnings data that lie ahead this week.  There is an eerie calm. Equities in Asia were mixed.  Japan and Hong Kong, and most small bourses were lower.  Last week, the MSCI Asia Pacific Index gained almost 0.9%. Europe's Stoxx 600 is little changed after rising about 0.5% last week. US futures are firm.  The S&P 500 and Dow Jones Industrials reached...

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Are the Technicals Anticipating a Soft US GDP Report? Could it be a “Sell the Rumor buy the Fact?”

2021-10-24

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2021-10-24

Rising yields and record highs in the S&P 500 and NASDAQ failed to lift the dollar.  Indeed, the greenback fell against all the major currencies, even the Japanese yen, against which it had reached new four-year highs (~JPY114.70) before pulling back.  On the other hand, the Antipodean currencies and the Norwegian krone continued to lead the move against the US dollar. The Aussie rose to new three-month highs, while the Kiwi, Nokkie, and...

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Week Ahead: The First Look at US and EMU Q3 GDP and more Tapering by the Bank of Canada

2021-10-23

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2021-10-23

The macro highlights for the week ahead fall into three categories.  First are the preliminary estimates for Q3 GDP by the US and the EMU.  Second, are the inflation reports by the same two.  The US sees the September PCE deflator, which the Fed targets, while the eurozone releases the first estimate for October CPI.  Third are the meetings of three G7 central banks, the BOJ, the ECB, and the Bank of Canada. The broad backdrop includes softening...

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The Euro and Sterling Remain within Tuesday’s Ranges

2021-10-22

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2021-10-22

Overview: A new record high in the S&P 500 yesterday and news that Evergrande had made an interest rate payment failed to lift most Asia Pacific bourses, though Japan and Hong Kong, among the large markets, posted modest gains.  The Dow Jones Stoxx 600 is pushing higher in the European morning to put its finishing touches on its third consecutive weekly gain.  US tech is trading off, and this is weighing on the NASDAQ futures while the S&P...

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Markets Turn Cautious

2021-10-21

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2021-10-21

Overview: After a couple of sessions of taking on more risk, investors are taking a break today.  Equities are mostly lower today after the S&P 500's six-day advance took it almost to its record high, while the NASDAQ's streak was halted at five sessions.

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Consolidative Session as Markets Await Fresh Incentives

2021-10-20

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2021-10-20

Overview: The markets lack a clear direction today and await fresh incentives.  After gaining almost 1% yesterday, the MSCI Asia Pacific Index slipped.  Japan, Hong Kong, and Australia are among the few equity markets that rose.

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Dollar Slumps

2021-10-19

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2021-10-19

Overview:  While equities and bonds are firmer, it is the dollar's sell-off that stands out today.  The greenback has retreated broadly.   

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Marc Chandler’s views on a changing interest rate regime for FX

2021-10-18

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In today's live stream, Coach Dale Pinkert welcomes Marc Chandler who is a foreign exchange market analyst, writer, speaker, and professor.

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Greenback’s Gains Pared Mostly, but Extended Against the Yen

2021-10-17

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2021-10-17

The Antipodeans and the Scandis led last week's move against the dollar, registering more than 1% gains.  The yen was the weakest of the major currencies, falling almost 1.75%, its worst week since March 2020. 

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A Short Note on the Pricing of the Fed Funds Futures: Aggressive

2021-10-14

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2021-10-14

In assessing the trajectory of Fed policy the market is discounting, we prefer using the Fed funds futures contracts over the Eurodollar futures.  The Fed funds settle at the average effective rate, while the Eurodollar futures contracts are three-month deposit rates.

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The Dollar Slips Ahead of CPI

2021-10-13

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2021-10-13

 The US dollar is trading with a lower bias ahead of the September CPI report due early in the North American session.  Long-term yields softened yesterday and slipped further today, leaving the US 10-year yield near 1.56%.  European benchmark yields are 3-4 bp lower.  The shorter-end of the US coupon curve, the two-year yield is firmer.

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The Euro Remains Within Last Wednesday’s Range

2021-10-12

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2021-10-12

Overview:  A weak close in US equity trading yesterday and the widening of China's "cultural revolution" for a two-month investigation of the financial sector stopped a three-day advance in the MSCI Asia Pacific Index.  China, South Korea, and Taiwan saw more than a 1% decline in their major indices. 

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FX Daily, October 11: Rate Expectation Adjustment Continues

2021-10-11

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2021-10-11

Overview:  Equities are softer and yields higher to start the new week.  The dollar is mixed.  Oil and industrial metals are higher. There are several developments over the weekend, but the focus seems to be on central bank action, inflation reports by the US and China, and the start of the Q3 earnings season. 

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The Market Likes the Dollar and the Loonie even More

2021-10-10

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2021-10-10

US rates and the dollar hardly responded to the disappointing jobs report.  The 194k rise in the nonfarm payrolls was the least this year, but of course, it is subject to revisions the way the August series was revised by more than 50% to 366k.

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Trees and the Forest

2021-10-09

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2021-10-09

The Pando (pictured here) appears to be 107 acres of forest, but scientists have concluded that the nearly 47,000 genetically identical quaking aspen trees share a common root system.

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Hope Springs Eternal, or at least enough to Lift Risk Taking Today

2021-10-07

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2021-10-07

Overview:  The animal spirits have been reanimated today.  Encouraged by the dramatic reversal in oil and gas prices, a deal in the US that pushes off the debt ceiling for a few weeks and talk of a new bond-buying facility in the euro area spurred further risk-taking today, ahead of tomorrow's US employment report. 

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Dollar Rallies as Energy Surge Quashes Animal Spirits

2021-10-06

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2021-10-06

Overview: Investors worry that surging energy prices will sap economic activity and boost prices.  It is sparking a sharp drop in equities and bonds while lifting the dollar.  The Nikkei fell for the eighth consecutive session, and today's 1% drop brings the cumulative decline to 9%.  South Korea's Kospi also fell by more than 1%. 

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Is the Dollar’s Rally since the Disappointing August Employment Report Over?

2021-10-03

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2021-10-03

The dollar's strong upside momentum, which accelerated after the FOMC meeting, stalled in recent days.  If interest rate considerations were the key driver, the Fed funds futures strip appears to have made the necessary adjustment. 

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Hard to Be Sterling

2021-09-29

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2021-09-29

Overview: Energy prices pulled back late yesterday, but it offered little reprieve to the bond market where the 10-year benchmark yields in the US, UK, Sweden, and Switzerland reached new three-month highs.  November WTI traded to almost $76.70 before reversing lower and leaving a potentially bearish shooting star candlestick in its wake. 

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Soaring Energy Prices Lift Yields, Weigh on Equities and the Greenback Pops

2021-09-28

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2021-09-28

Overview: Rising energy prices and yields are helping lift the US dollar and weighing on equities.  November WTI has pushed above $76, while Brent traded above $80, and natural gas is up for the fourth consecutive session, during which time it has risen by about 25%. 

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