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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Busy Week for the UK

2016-12-13

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2016-12-13

The UK reports inflation, employment and retail sales this week. The BOE meets but will keep rates steady. The US 2-year premium over the UK is the highest since at least 1992 today.

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FX Daily, December 12: Dollar and Yen Trade Lower to Start the Week

2016-12-12

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2016-12-12

FX Performance, December 12 2016 Movers and Shakers
The US dollar and Japanese yen are trading lower. The tone is largely consolidative, and the foreign exchange market is not main focus today. Instead, the OPEC-non-OPEC agreement before the weekend is arguably the key driver today. Oil prices are up 4.5%-4.8%, lifting bond yields and supporting oil producers' currencies, like the Norwegian krone, Canadian dollar, the Russian ruble and Mexican peso.

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Weekly Speculative Positions: Short CHF Close to Records of 2015

2016-12-12

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2016-12-12

The net short CHF speculative position is close to reaching new records. Shortly before the end of the peg, speculators were net short CHF by 26.4K contracts. Now we are at 25.4K.

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FX Weekly Preview: What the FOMC Says may be More Important than What it Does

2016-12-12

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2016-12-12

Economic Events: Eurozone, Week December 12
FOMC meeting is the last highlight of the year. OPEC and non-OPEC producers strike a deal: optics good and that can lift prices further in near term. Italy will have a new Prime Minister, the fourth unelected PM.

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FX Weekly Review, December 05 – December 09: Dollar Bulls Running Out of Time to See Parity vs Euro in 2016

2016-12-11

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2016-12-11

Trade-weighted index Swiss Franc, December 02
  Swiss Franc Currency Index The Swiss Franc index remained in a losing position compared to the dollar index. However since November 25, it has remained stable. Given that the ECB extended the QE period, the EUR/CHF has fallen to 1.0730 again.   USD/CHF The US dollar is finishing the year on a firm note.  It rose … Continue reading »

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FX Daily, December 09: Euro Chopped Lower before Stabilizing

2016-12-09

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2016-12-09

FX Performance, December 09 2016 Movers and Shakers
The euro has stabilized after extending yesterday's ECB-driven losses. The euro's drop yesterday was the largest since the UK referendum to leave the EU. Ahead of the weekend, there may be some room for additional corrective upticks, but they will likely be limited, with the $1.0650 area offering initial resistance. In the larger picture, this week's range, roughly $1.05 to $1.0850 likely will confine the price action for the remainder of the...

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Great Graphic: Another Look at the Reproduction Problem

2016-12-09

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2016-12-09

Change of making more money than your parents if you were
In order for a society to be sustained social relations have to be reproduced. Yet now neither the middle class nor capital are able to reproduce themselves. This may be the single greatest challenge our society faces.

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FX Daily, December 08: Dollar Heavy into ECB

2016-12-08

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2016-12-08

FX Performance, December 08 2016 Movers and Shakers
The ECB prolonged its bond purchases, which came unexpected for markets. Consequently the EUR/CHF lost nearly half of its big gains that it registered in the beginning of the week. The ECB expects lower inflation for longer, which makes the life for the SNB harder for longer.

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ECB: Dovish Taper or Hawkish Ease?

2016-12-08

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2016-12-08

Mario Draghi
Purchases increased for longer but at a lower level; overall, more purchases than anticipated. Euro spiked higher on the announcement, but has subsequently dropped 2 cents. Lower inflation forecast for 2019 shows scope for a further extension.

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Cool Video: Discussing the ECB on Bloomberg TV

2016-12-08

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2016-12-08

Marc Chandler
Tired of reading what analysts are saying? Here is a 4.3 minute video clip of my discussion earlier today on Bloomberg TV about the outlook for tomorrow's ECB meeting. The discussion covers various aspects of the ECB's decision.

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ECB and the Future of QE

2016-12-08

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2016-12-08

ECB will likely extend asset purchases in full. It may modify the rules by which it buys securities. It may adjust the rules of engagement for its securities lending program.

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FX Daily, December 07: Greenback is Broadly Steady While Sterling Slides

2016-12-07

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2016-12-07

FX Performance, December 07 2016 Movers and Shakers
The US dollar is little changed against most of the major currencies. Sterling is the notable exception, losing about 0.75% to trade at three-day lows. It was on the defensive in early European turnover but got the run pulled from beneath by the unexpectedly poor data. UK industrial output fell by 1.3% in October. The median forecast was for a small increase.

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Greek Bonds may Soon be Included in ECB Purchases

2016-12-06

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2016-12-06

The ECB accepts Greek bonds as collateral but does not include them in its asset purchases. A new staff-level agreement by the end of the year could change that. Finance ministers imply that Greece's debt is sustainable, but the IMF disagrees.

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FX Daily, December 06: You Can Almost Hear a Pin Drop

2016-12-06

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2016-12-06

FX Performance, December 06 2016 Movers and Shakers
The foreign exchange market is quiet. Ranges are narrow, with the US dollar mostly consolidating against the major currencies. Given the push lower yesterday, the shallowness of its recovery warns of the greenback's downside correction after strong gains last month may not be complete.

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Yen and US Yields

2016-12-06

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2016-12-06

Dollar-yen has been driven by the sharp rise in US bond yields. There are some (dollar) bearish divergences in the JPY/USD technicals. US 10-year yields may also be putting in a near-term top.

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Great Graphic: Dollar Index Update

2016-12-05

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2016-12-05

The Dollar Index's technical tone has deteriorated. It is corresponding to the easing of US rates and a narrowing differential. The risk is that the correction can continue in the coming days.

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FX Daily, December 05: Dollar Comes Back Bid, but Still Vulnerable to Corrective Pressures

2016-12-05

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2016-12-05

FX Performance, December 05 2016 Movers and Shakers
After softening ahead of the weekend, the US dollar has begun the new week on a firm note. It is gaining against most major and emerging market currencies. Outside of what appears to be a staged call between US President Elect Trump and the Taiwanese President, the developments in Europe grabbed the markets' attention. Austria turned back the populist right Freedom Party's bid for the presidency. The Freedom Party does not appear to have carried...

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FX Weekly Preview: Focus Shifts toward Europe

2016-12-05

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2016-12-05

Economic Events: Eurozone, Week December 05
US developments have driven the dollar rally and bond market decline over the past three weeks. Attention shifts to European politics and the ECB meeting. Bank of Canada and the Reserve Bank of Australia meet but are unlikely to change policy.

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What’s next for gold after the Italian referendum

2016-12-04

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Adam Button from ForexLive speaks to Kitco about the outlook for gold and why the Italian referendum probably won’t matter.

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FX Weekly Review, November 28 – December 02: CHF Index still at its 4% loss since U.S. Elections

2016-12-04

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2016-12-04

Trade-weighted index Swiss Franc, December 02
The Swiss Franc index continued around its 4% loss since the U.S. elections, while the US Dollar index had a 4% increase. The focus shifts to the ECB meeting, where participants are wary of a "hawkish ease".

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