Category Archive: 4) FX Trends

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.

My articles My offer My site About me My books
Follow on:LinkedIN Twitter Seeking Alpha Amazon

Filter archive by: Show All Show only Articles Show only Videos

FX Daily, June 6: US Tariff Threats on Mexico Compete with ECB for Attention

2019-06-06

by Marc Chandler

2019-06-06

Overview: The implications of President Trump's assessment that there has not been "nearly enough" progress in negotiations with Mexico that would avert the tariff on June 10 competing for investors' attention, which had been squarely today's ECB meeting. Minutes before Trump spoke Fitch cut its sovereign rating for Mexico to BBB from BBB+, while Moody's cut its outlook to negative from stable.

Read More »

FX Daily, June 05: Dollar Remains on Back Foot

2019-06-05

by Marc Chandler

2019-06-05

Overview: The Federal Reserve's patience never excluded a rate cut should conditions warrant. The acknowledgment of this without signaling a change its stance is being seized upon to justify aggressive pricing of rates. At the same time, there has some tempering of trade anxiety on the margin that is also constructive. Asia and European equities were pulled higher after the strongest rally in several months in the US.

Read More »

FX Daily, June 04: Nervous Calm Settles Over Markets

2019-06-04

by Marc Chandler

2019-06-04

The global capital markets are stabilizing today after taking a body blow of broadening the use of US tariffs (in migration dispute with Mexico), threatening the ratification of NAFTA 2.0, and still escalating hostile rhetoric between the US and China, and the threat of anti-trust action against the largest digital platforms.

Read More »

FX Daily, June 03: US Penchant for Tariffs Keeps Investors on Edge

2019-06-03

by Marc Chandler

2019-06-03

Overview: The weekend failed to break the grip of investor worries that is driving stocks and yields lower. The US Administration's penchant for tariffs is not simply aimed at China, where there is some sympathy, but the move against Mexico, dropping special privileges for India, and apparently, had considered tariffs on Australia. At the same time, the threat of 25% tariff on auto imports.

Read More »

FX Weekly Preview: Curiouser and Curiouser

2019-06-03

by Marc Chandler

2019-06-03

The first week of June features the Reserve Bank of Australia meeting, an ECB meeting, and the US employment data. The RBA is expected to deliver its first rate cut in three years. The market appears to have discounted not only a second cut in H2 but has priced nearly half of a third cut as well.

Read More »

FX Daily, May 31: US Struggles to Build Physical Wall, Tries Tariff Wall on Mexico

2019-05-31

by Marc Chandler

2019-05-31

Overview: The US announcement to lay a 5% tariff on all goods coming from Mexico (starting June 10) until it stops the flow of "illegal migrants" spurred sharp losses in the Mexican peso and general risk-off move that strengthened the yen. The tariffs are set to rise every month until reaching 25%. This is a significant surprise and especially given that the Trump Administration is preparing to formally submit the USMCA to Congress.

Read More »

Canada, Mexico, and the USMCA

2019-05-31

by Marc Chandler

2019-05-31

The US dollar closed today above CAD1.3500 for the first time since January 2. Despite the setback, the Canadian dollar is the strongest of the major currencies year-to-date with a little less than a one percent gain. The yen, in second, has is up about 0.2% (~JPY109.50). Among emerging market currencies, the Mexican peso's 2.6% gain puts it in in second place behind the Russian rouble's 7.2% appreciation.

Read More »

FX Daily, May 30: Kill Bull: Intermission

2019-05-30

by Marc Chandler

2019-05-30

Overview: After significant moves in equities and interest rates, investors are taking a collective breath, waiting for fresh developments. A nervous calm has settled over the capital market. China, Japan, and Australian equities leaked lower, but other bourses in the region, including Korea and Taiwan posted modest gains, while Indonesian equities are still responding positively to the recent election.

Read More »

FX Daily, May 29: Equity Slump Deepens while Yields Plunge

2019-05-29

by Marc Chandler

2019-05-29

Overview: The slump in equities continues after the poor showing in the US yesterday. Nearly all bourses in Asia Pacific and Europe are lower. Indonesia is the notable exception as domestic operators re-position after the election. Foreign investors have been notable sellers of Korean and Taiwanese shares this month (in excess of $6.2 bln). Europe's Dow Jones Stoxx 600 is testing its lowest levels since March, and the S&P 500 is poised to gap...

Read More »

Bannockburn’s Chandler: We’re at the lower rungs of a large trade escalation ladder

2019-05-28

by Marc Chandler

Marc Chandler of Bannockburn Global Forex discusses what people may be missing from the US-China trade war, and other global risks that could impact markets.

Read More »

FX Daily, May 28: Risk Appetites Curbed, US Leadership Awaited in FX

2019-05-28

by Marc Chandler

2019-05-28

Overview: The euro initially reacted positively to the EU Parliament elections. The populists did not do quite as well as many expected. The two main groupings failed to secure a majority, but with the help of the Liberals, and possibly the Greens, that did well throughout Europe, a new European Commission will be forged. The heads of state meet later today, but no real decisions are likely. The horse trading will likely take most of the next...

Read More »

FX Weekly Preview: The Evolution of Three Issues are Key in the Week Ahead

2019-05-27

by Marc Chandler

2019-05-27

As May winds down, the light economic calendar will allow investors to take their cues from the evolution of three disruptive forces--trade, Brexit and the US economy. With actions against Huawei and possibly a handful of Chinese surveillance equipment producers, the US raised the stakes. The retaliatory tariffs are effective on June 1, but Beijing has not formally responded to the moves against Chinese companies.

Read More »

FX Daily, May 23: Trade, Brexit, and Disappointing Flash PMIs Weigh on Global Markets

2019-05-23

by Marc Chandler

2019-05-23

Overview: The deterioration of the investment climate is spurring the sales of stocks and the buying of bonds. The dollar is firm. China and the US appear to be digging as if the trade tensions will remain for some time and the breech is beginning to look too big for Trump and Xi to pull another rabbit out of the hat like they did at the end of last year when the tariff truce was struck. The move against Huawei and possible a number of...

Read More »

FX Daily, May 22: Sterling Can’t Get Out of Its Own Way

2019-05-22

by Marc Chandler

2019-05-22

Overview: There is a nervous calm in the capital markets. Yesterday's rally in US shares failed to excite global investors. China, Hong Kong, and Taiwan markets fell, while Japan was mixed. Foreign investors continued to sell Korean shares, but the Kospi rose. European shares narrowly mixed, leaving the Dow Jones Stoxx 600 little changed.

Read More »

Rare Earths may Provide Leverage

2019-05-22

by Marc Chandler

2019-05-22

Many American observers argue that the trade imbalance gives the US an advantage in a trade war with China. The US enjoys escalation dominance in tariffs because Chinese imports of US goods are so much less than the US imports of Chinese goods. However, the focus on quantities may be misleading.

Read More »

FX Daily, May 21: Equities Find Some Traction while the Dollar Firms

2019-05-21

by Marc Chandler

2019-05-21

Overview: Equities are paring some of their recent losses. The MSCI Asia Pacific Index is posting its first back-to-back gain in a month, led by a more than 1% rally in China. Heightened prospects for an Australian rate cut in a few weeks helped extend the run in the local equity market to a new record high. European bourses are higher, with the Dow Jones Stoxx 600 rising around 0.3% in the morning session.

Read More »

FX Daily, May 20: Politics Overshadows Economics Today, but Japan’s Economy Unexpectedly Expanded in Q1

2019-05-20

by Marc Chandler

2019-05-20

Encouraged by the election results, investors bid up Indian and Australian currencies and equities. Japan offered a pleasant surprise by reporting the world's third-largest economy expanded in Q1. Most other equity markets in Asia fell, and European stocks have the week with small losses.

Read More »

FX Weekly Preview: The Week Ahead featuring the Battle for 7.0

2019-05-20

by Marc Chandler

2019-05-20

The strategic objective is to integrate China into the world economy. The liberal international solution was trade, investment flows, and cultural exchanges. The rise of nationalism and China's own willingness to flaunt the international rules are defeating the strategy.

Read More »

FX Daily, May 17: China Questions US Sincerity

2019-05-17

by Marc Chandler

2019-05-17

Since the presidential tweets on May 3, the US had the initiative in the negotiations with China, but today, China has pushed back. It is cool to the idea promoted by the US that trade talks will resume shortly. Now it may take the Trump-Xi meeting at the end of next month to restart talks. This, coupled with US sanctions on Huawei banning imports from it and sales to it, threatens to disrupt business and this took a toll on Chinese, Taiwanese and...

Read More »