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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The Wait is Nearly Over, and the Dollar Catches a Bid

2015-12-02

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2015-12-02

The anticipation is nearly over.  The softer than expected preliminary EMU inflation figures encourages expectations for the more aggressive range of actions by the ECB tomorrow.  Draghi has claimed that movement toward the inflation target was to...

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Great Graphic: Canadian Growth and Rate Expectations

2015-12-01

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2015-12-01

Canada reported its monthly GDP estimate for September, and at the same time, provided its first estimate of Q3 GDP.   The Great Graphic, created on Bloomberg, shows both time series. The monthly GDP is depicted by the yellow line and the quart...

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Dollar Trades Heavier, Key Events Awaited

2015-12-01

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2015-12-01

The US dollar is trading with a heavier bias today amid some last minute position squaring ahead of the key events of the week, which are stacked in the second half.  The ECB meeting and US jobs data are the two most important events in a jam pa...

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Cool Video: CNBC Discussion about China and the SDR

2015-12-01

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2015-12-01

I had the privilege of being on CNBC to discuss the significance of China being included in the IMF's Special Drawing Right. Here is the link to the discussion.  The decision was announced shortly after the interview on CNBC.  It was largely a foregone conclusion that China would join.  Besides the confirmation, the new news … Continue reading...

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Great Graphic: Decline of U.S. Participation Rate Explained

2015-11-30

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2015-11-30

The decline in the labor force participation rate helps explain the substantial decline in the US unemployment rate over the past couple of years.  That decline has helped bring the Federal Reserve to the point that a December rate hike is thought to be extremely likely barring a significant disappointment at the end of the …

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Emerging Markets: Preview of the Week Ahead

2015-11-30

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2015-11-30

(from my colleagues Dr. Win Thin and Ilan Solot) This is set to be one of the most important weeks of the year. EM is likely to take a backseat between the ECB monetary policy decision, the OPEC meeting and the US jobs report. That said, there are several potential sources of idiosyncratic risk to … Continue reading »

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Dollar Edges Higher Ahead of Month-End and Key Events

2015-11-30

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2015-11-30

The US dollar remains firm against most of the major currencies to start what promises to be a critical week for investors.  There are two main considerations.  The first is the last minute position adjustments ahead the key events that begin with the IMF's SDR decision later today, running through the start-of the month data …

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Seven Events Next Week that will Shape the Investment Climate

2015-11-29

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2015-11-29

The week ahead is among the most important of the year.  Rarely is there such a confluence of events in a short period that will have far-reaching implications for investors that are known ahead of time and have been discussed so extensively. ?...

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How Dangerous are Technical Conditions for Dollar Bulls?

2015-11-28

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2015-11-28

Anticipating a yawning divergence of monetary policy between the world's largest central banks, market participants continued to drive the dollar higher over the past week.  In fact, the greenback appreciated against all the major and emerging market currencies except the Malaysian ringgit and South Korean won.     Next week is one of the most eventful …

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France’s Revival or Politics Trumps Economics

2015-11-27

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2015-11-27

With the ECB poised to take additional steps down the unorthodox monetary policy route, financial and economic forces are as potent as ever.  However,  there is a subtle shift taking place that few seem to recognize.  It is the re-emergence of...

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Emerging Markets: What has Changed

2015-11-27

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2015-11-27

(from my colleagues Dr. Win Thin and Ilan Solot) 1) Mauricio Macri, the mayor of Buenos Aires, won the Argentine presidential election with 52% of vote  2) The latest political developments in Brazil rocked asset prices  3) The Brazilian cent...

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Dollar Rides High into Month-End

2015-11-27

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2015-11-27

The US dollar is firm against the major currencies and nearly all the emerging market currencies as well to close out the week (and month) Participants are clearly focused on next week's events, and in particular, the prospect of additional easi...

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Table is Set, Dollar Consolidates

2015-11-26

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2015-11-26

The US dollar remains firm, even if it has eased from its seven-month high against the euro and five-year high against the Swiss franc recorded yesterday.  The US October personal consumption expenditure was disappointing, and prompted some downward revision to Q4 GDP forecasts. The Atlanta Fed estimates that Q4 GDP is tracking 1.8% rather than …

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Great Graphic: US 2-Year Premium over Japan and Germany

2015-11-25

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2015-11-25

This Great Graphic was composed on Bloomberg.  It shows two time series.  The yellow line shows the premium the US pays over Germany for two-year money.  The white line shows the premium the US pays over Japan for two-year money.   The premiums have risen sharply since mid-October and today are at new multi-year highs. … Continue...

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Discount Rate Follow-Up: And Then There were Nine

2015-11-25

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2015-11-25

On Monday, the Federal Reserve met to discuss the discount rate.   There has been a steady increase in the number of regional Federal Reserve presidents requesting an increase in the discount rate.  The minutes of the October 26 meeting were reported yesterday. The meeting was held before the FOMC met on October 27-28.  At that meeting, … Continue...

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Euro Bears Aren’t Hibernating

2015-11-25

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2015-11-25

The divergence of monetary policy is discounted, they argued. Ahead of next week's big events, which include the IMF's SDR decision, the ECB meeting, OPEC meeting, and the US jobs data, the euro, against which speculators have amassed a large sh...

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Dollar Recoups January Loss Against the Swiss Franc

2015-11-24

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2015-11-24

The US dollar recorded its high for the year against the Swiss franc on January 14 near CHF1.0240.  It closed that day a little below CHF1.0190.  The next day the Swiss National Bank surprised the world by lifting its cap against the euro.  The ...

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Why Portuguese Politics Matter

2015-11-24

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2015-11-24

A NATO country has shot down a Russian plane.  The refugee influx is threatening to unravel the Schengen Treaty of free movement.    Germany's Merkel celebrated her tenth anniversary as Chancellor this past weekend, but she faces one of the most serious challenges of her tenure.    Portugal accounts for less than 2% of the eurozone GDP.  …

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Dollar Softens, Consolidation Phase Continues

2015-11-24

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2015-11-24

The US dollar is trading choppily but with a distinct softer bias.  The economic news has been limited, and the apparent downing of a Russian plane by Turkey caused a flurry of activity, with Turkish assets coming under initial pressure which has abated somewhat.   The euro briefly dipped below $1.06 yesterday for new seven-month lows, …

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Great Graphic: Canadian Dollar and the Two-Year Rate Differential

2015-11-23

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2015-11-23

The Canadian dollar is more than a petro currency.    It is also subject to the same forces of divergence that have lifted the US dollar more broadly.  Since the beginning of the year, the US two-year yield has risen 26 bp while Canada's two-year yield has fallen almost 39 bp. This Great Graphic, created on …

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