Tag Archive: Argentina

Eurobonds Behind Euro$ #5’s Collateral Case

2022-05-12

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2022-05-12

The bond market is allegedly populated by the “smart” set, whereas those trading equities derided as the “dumb” money (not without some truth). I often wonder if it’s either/or. The fixed income system just went through this scarcely three years ago, yet all signs and evidence point to another repeat.

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An International Puppet Show

2020-04-23

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2020-04-23

Federal Reserve: H.10 Foreign Exchange Rates, 2006-2020
It’s actually pretty easy to see why the IMF is in a hurry to secure more resources. I’m not talking about potential bailout candidates banging down the doors; that’s already happened. The fund itself is doing two contradictory things simultaneously: telling the world, repeatedly, that it has a highly encouraging $1 trillion in bailout capacity at the same time it goes begging to vastly increase that amount.

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FX Daily, April 21: Oil Drilled Below Zero, Equity Rally Stalls, Greenback Advances

2020-04-21

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2020-04-21

Overview:  Oil's wild ride has been joined by two other developments that are keeping investors off-balance. First, reports suggest that North Korea's Kim Jong-Un maybe in critical condition after surgery. He apparently was absent from last week's events celebrating his grandfather.

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Fragile, Not Fortified

2020-04-09

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2020-04-09

Credit Spreads, 2017-2020
On Sunday, Argentina’s government announced it was postponing payment on any domestically-issued debt instruments denominated in foreign currencies. That means dollars, just not Eurobonds. At least not yet. In response, ratings agencies such as Fitch declared the maneuver a distressed debt exchange.In other words, technically a default.

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(No) Dollars And (No) Sense: Eighty Argentinas

2020-03-31

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2020-03-31

India Official Reserve Assets, 2016-2020
India like many emerging market countries around the world holds an enormous stockpile of foreign exchange reserves. According to the latest weekly calculation published by the Reserve Bank of India (RBI), the country’s central bank, that total was a bit less than half a trillion. While it sounds impressive, when the month began the balance was much closer to that mark.

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Time Again For Triple Digit Dollar

2020-02-23

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2020-02-23

Argentina Official Reserve Assets, 1998-2018
Being a member of the institutional “elite” means never having to say you’re sorry; or even admit that you have no idea what you are doing. For Christine Lagarde, Mario Draghi’s retirement from the European Central Bank could not have come at a more opportune moment. Fresh off the Argentina debacle, she failed herself upward to an even better gig.

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FX Daily, December 3: US Brandishes Tariff Weapon and Weakens Animal Spirits

2019-12-03

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2019-12-03

Asia Pacific equities mostly declined in sympathy with yesterday's large sell-off in the US and Europe. China and Taiwan were the notable exceptions, while Australia's 2.2% decline, following the central bank meeting that resulted in what many are seeing as a hawkish hold, led the move lower. Europe's Dow Jones Stoxx 600 fell 1.6% yesterday, the largest loss in two months, and is extending the losses for a third session today.

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FX Daily, August 13: Investors Remain on Edge

2019-08-13

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2019-08-13

Overview:  The confrontation in Hong Kong and the fallout from the Argentine primary over the weekend join concerns the conflict between the two largest economies and slower growth to force the animal spirits into hibernation.  Global equities remain under pressure.  Japan's Topix joined several other markets in the region to have given up its year-to-date gain. 

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FX Daily, August 12: Yen Remains Bid, While Macri’s Loss in Argentina Weighs on Struggling Mexican Peso

2019-08-12

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2019-08-12

Overview: China again tried to temper the downside pressure on the yuan, and this appears to be helping the risk-taking attitude. Many centers in Asia were closed today, including Japan and India, though most of the other equity markets advanced modestly, including China, Korea, and Australia. Europe's Dow Jones Stoxx 600 opened firmer but is staddling little changed levels unable to stain any upside momentum.

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FX Daily, April 25: Equities Waiver, the Dollar Does Not

2019-04-25

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2019-04-25

Overview:  After closing at record highs on Tuesday, the S&P 500 slipped yesterday, and the Dow Jones Stoxx 600 snapped an eight-session advance.  Asia followed suit, with the Shanghai Composite posting its biggest loss (~2.4%) in over a month.  It is off about 4.6% this week, which if sustained tomorrow, would be the largest loss in six months.

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Emerging Markets: Preview of the Week Ahead

2018-09-17

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2018-09-17

EM FX ended mixed in Friday, capping off an up and down week. RUB and TRY initially firmed on their respective rate hikes but gave back some of those gains heading into the weekend. Trade tensions are likely to remain high, as press reports suggest President Trump is pushing ahead with tariffs on $200 bln of Chinese imports even as high-level talks are planned.

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Emerging Markets: What has Changed

2018-09-10

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2018-09-10

Philippine central bank signaled another big hike. Poland central bank appears to be moving its forward guidance out further. Russia officials are sending confusing signals regarding monetary policy. Russia officials stand ready to support the ruble debt market if new US sanctions negatively impact it. South Africa’s African National Congress pledged to undertake land reform responsibly.

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As Emerging Market Currencies Collapse, Gold is being Mobilized

2018-09-03

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2018-09-03

EM-cartoon
In recent weeks, global financial markets have been increasingly spooked by an intensifying crisis in emerging market currencies including those of Turkey and Argentina. Add to this the ongoing currency crisis in Venezuela and the currency problems of Iran.

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Emerging Markets: Preview of the Week Ahead

2018-08-13

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2018-08-13

EM FX came under greater pressure last week as the situation in Turkey deteriorated. With no weekend developments as of this writing, we expect Turkish assets to remain under pressure this week. Five worst EM currencies YTD are TRY (-41%), ARS (-36%), RUB (-15%), BRL (-14.5%), and ZAR (-12%). All five have serious baggage that warrants continued underperformance.

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Emerging Markets: What Changed

2018-06-18

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2018-06-18

US-China trade tensions are rising. Pakistan devalued the rupee for a third time since December. Bulgaria will seek to join the eurozone banking union and ERM-2 simultaneously. The National Bank of Hungary appears to have tilted more hawkish. Newly elected Egyptian President El-Sisi shuffled his cabinet. Argentina has a new central bank chief after Federico Sturzenegger resigned.

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Emerging Markets: What Changed

2018-06-11

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2018-06-11

The Reserve Bank of India hiked rates for the first time since 2014. Malaysia’s central bank governor resigned. Czech central bank tilted more hawkish. Russia central bank tilted more dovish. Argentina got a $50 bln standby program from the IMF.

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Emerging Markets: What Changed

2018-05-21

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2018-05-21

Bank Indonesia started a tightening cycle with a 25 bp hike to 4.5%. Jailed Malaysia opposition leader Anwar Ibrahim was released by new Prime Minister Mahathir. Malaysia scrapped the controversial 6% goods and services tax (GST). Violent protests shook Israel as the relocated US embassy opened in Jerusalem.

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Emerging Markets: Preview of the Week Ahead

2018-05-14

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2018-05-14

EM FX ended Friday on a week note and capped of another generally negative week. Worst performers last week were ARS, BRL, and TRY while the best were ZAR, RUB, and KRW. We remain negative on EM FX and look for losses to continue. US retail sales data Tuesday pose further downside risks to EM FX.

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Emerging Markets: What Changed

2018-01-27

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2018-01-27

Korea policymakers have asked state-owned banks and companies to limit the issuance of global bonds. Malaysia's central bank hiked rates for the first time in four years. Pakistan’s central bank unexpectedly hiked rates for the first time in over four years. Moody’s raised its outlook on Russia’s Ba1 rating from stable to positive. Argentina’s central bank surprised markets with its second straight 75 bp rate cut.

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