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.

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FX Weekly Review, February 06 – 11: Further Dollar and CHF Strength versus Euro weakness ahead?

2017-02-12

by George Dorgan

2017-02-12

Swiss Franc Index Trade-weighted index Swiss Franc

We are expecting a further strengthening of both dollar and Swiss Franc against the euro over the next 3 months. Reason is the rising Swiss demand the continued dovishness of the ECB, despite rising inflation.

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Fake News. Fake Breaks. What do they have in common? How to deal with them?

2017-02-12

by Forexlive

When I hear the word “fake:, I cannot help but think of “fake news”. Fake news has become so pervasive, I combat it by waiting for the dust to settle, fact checking and making logical judgments. In trading there are a number of times when you will get a fake break. Coincidentally, I deal with …

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FX Traders Have To (Re)Learn A New Skill

2017-02-11

by Tyler Durden

2017-02-11

China Trade Balance with United States, April 2016-January 2017

Dear FX traders: forget the dot plot, and prepare to learn a new - or to some forgotten - skill: how to read trade flows. As Bloomberg's Vincent Cignarella and Andrea Wong point out, currency traders accustomed to analyzing the Fed’s dot plot and monthly U.S. jobs figures to predict the direction of the world's reserve currency are having to learn, or in some cases re-learn, a largely forgotten ability: how to scrutinize trade data. With...

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FX Daily, February 10: US Dollar Holding on to Week’s Gains

2017-02-10

by Marc Chandler

2017-02-10

The US dollar is about 12 hours away from gaining against all the major currencies this week. The main talking points today remain Trump-centric. The US dollar is mixed as European trading gets underway. Of note the dollar is continuing to gain on the yen. The yen is off 0.4%, which is nearly half the week's decline. The Aussie is the strongest on the day, up about 0.2% to trim the week's loss to about 0.45%.

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Cool Video: Bearish Case for Euro and Prospect of Currency Wars

2017-02-10

by Marc Chandler

2017-02-10

Still in London as this part of the business trip is winding down. I had the privilege of going over to the Bloomberg office today and spoke with Vonnie Quinn and Mark Burton about the euro's outlook and whether the US should have a strong or weak dollar.

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Trump’s New Dollar Policy

2017-02-09

by Forexlive

Adam Button at ForexLive talks about a generational change in US currency policy and what it could mean if Trump abandons the strong dollar policy. What are the forex trades if it happens? When could we expect it?

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FX Daily, February 09: Dollar Bounce in Asia is Sold in the European Morning

2017-02-09

by Marc Chandler

2017-02-09

The US dollar is firmer against most of the major currencies in fairly quiet Asian turnover, but is seeing those gains pared in early Europe. The highlights include the RBNZ meeting that left rates on hold, as widely expected. The concern about the strength of the Kiwi saw the market reduce the perceived likelihood of a rate hike. NZD came off.

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Is a Strong or Weak Dollar Good for the US? The $16 trillion Question

2017-02-09

by Marc Chandler

2017-02-09

Dollar movement helps some economic interest and hurts others. From a strategic point of view, the best thing for the US is the market-generated rate. It was an important achievement that the forex market was de-weaponized. Many observers have been crying wolf about a currency war for many years, which may have de-sensitized investors to the threat of a real one.

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Cool Video: Around the World with Katie Martin of the Financial Times

2017-02-09

by Marc Chandler

2017-02-09

I am in London as part of a larger business trip. I had the chance today to talk to Katie Martin, who runs Fast FT and is often writing about foreign exchange. They show was live on Facebook. It is about a 22 minute interview and although foreign exchange is the key issue, to get to it we end up talking about many things, including US interest rates, Trump, and even cooking frogs.

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FX Daily, February 08: EUR/CHF down to 1.630, Swiss Boom Starting?

2017-02-08

by George Dorgan

2017-02-08

The reader might have seen the latest Swiss Consumer Sentiment and the UBS consumption indicator. They suggest that the Swiss boom phase should finally come. I anticipated the boom already in my slides for the CFA Society. The Swiss boom was postponed when the SNB decided to remove the euro peg in early 2015.

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Largest Retail FX Broker FXCM Banned By CFTC, Fined $7 Million For Taking Positions Against Clients

2017-02-08

by Tyler Durden

2017-02-08

The CFTC on Monday fined Forex Capital Markets, parent FXCM Holdings LLC and founding partners Dror Niv and William Ahdout to pay $7 million to settle charges it defrauded retail foreign exchange customers and engaging in false and misleading solicitations. As part of the settlement, FXCM agreed to withdraw its registration and never seek to register with the CFTC again, effectively banning it from operating in the US.

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Great Graphic: Interesting Sterling Price Action

2017-02-08

by Marc Chandler

2017-02-08

Sterling is having an interesting day. It fell in the face of the US dollar's bounce but has recovered fully. It has not yet traded above yesterday's high (~$1.2510) but it may. It does appear to be tracing out a hammer in Japanese candle stick terms.

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The Dollar: Real or Nominal Rates?

2017-02-06

by Marc Chandler

2017-02-06

Real interest rates are nominal rates adjusted for inflation expectations.Inflation expectations are tricky to measure. The Federal Reserve identifies two broad metrics. There are surveys, like the University of Michigan's consumer confidence survey, and the Fed conducts a regular survey of professional forecasters. There are also market-based measures, like the breakevens, which compare the conventional yield to the inflation-linked, or protected...

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FX Weekly Preview: Politics Not Economics is Driving the Markets

2017-02-06

by Marc Chandler

2017-02-06

The Fed is more confident this year of stable growth and rising inflation. The new US Administration's economic agenda is beginning to take shape, though it is not clear that consumer interests will be pursued. There are several considerations, including politics in Europe, that are driving European rates higher. The RBA and RBNZ meet next week. Neither is expected to change policy.

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FX Weekly Review, January 30 – February 04: Reversal of Trump Reflation Trade Continues

2017-02-05

by George Dorgan

2017-02-05

Swiss Franc Index Trade-weighted index Swiss Franc 1M

The Swiss Franc index remained around the 2% gain that for the last month, the recovery from the Trump reflation trade. In this trade, investors preferred U.S. against European stocks. This tendency, however, is reversing now - and with it the franc recovered.

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FX Daily, February 03: US Jobs Trump Europe’s Service PMIs

2017-02-03

by Marc Chandler

2017-02-03

FX Performance, February 03 2017 Movers and Shakers

Ahead of the weekend, there are two series of economic reports. The first are Europe's service PMI reports and the second is the US employment report. Neither report is likely to alter views significantly, but the latter has greater potential to move the market.

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The Future of Globalization

2017-02-03

by Marc Chandler

2017-02-03

antiglobalizationThe cross-border movement of goods, services, and capital increased markedly for the thirty years up to the Great Financial Crisis. Although the recovery has given way to a new economic expansion in the major economies, global trade and capital flows remain well below pre-crisis levels. It had given rise to a sense globalization is ending.

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FX Daily, February 02: Dollar Remains on Back Foot After ADP and FOMC

2017-02-02

by Marc Chandler

2017-02-02

FX Performance, February 02 2017 Movers and Shakers

The US dollar remains on its back foot despite the stronger than expected ADP job estimate and the FOMC that said nothing to dissuade investors that it will be gradually raising rates this year.

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Great Graphic: French Premium over Germany Continues to Grow

2017-02-02

by Marc Chandler

2017-02-02

European premiums over Germany typically increase in a rising interest rate environment. France's premium is at the most in two years. France is still set to turn back the challenge from Le Pen.

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Thoughts about the Fed’s Balance Sheet

2017-02-02

by Marc Chandler

2017-02-02

Several regional Fed presidents want to begin talking about shrinking Fed's balance sheet. Leadership does not appear to have great urgency, so don't expect anything in this week's statement. First step more hikes, then refrain from reinvesting payments and maturities, but slowly.

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