Tag Archive: $AUD

FX Daily, November 23: Friday

The US dollar is firmer against most of the major currencies. Japanese and Indian markets were closed for holidays and a weaker than expected flash EMU PMI helped keep the euro pinned near this week's lows. Although the EU seemed to thrown UK's embattled May a lifeline with some compromise wording in a draft declaration, the challenge remains the same--Parliament's approval.

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FX Daily, November 21: A Semblance of Stability Returns

Yesterday's frenzy has burnt itself out for the moment. Equities began recovering in Asia after early losses. China, including Hong Kong, Singapore, and Thailand closed higher and European markets are recouping some of yesterday's decline. The Dow Jones Stoxx is trying to snap a five-day decline and is up a little more than 0.5% near midday.

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FX Daily, November 20: Equity Slide Continues

Yesterday's 3% drop in the NASDAQ is setting the tone for today. The US stock market advance had been led by a narrow group of equities, and those have come under strong pressure amid slower consumer demand and stricter export control. Asian equities were a sea of red today. Chinese markets led the sell-off with more than a 2% drop. In Europe, the Dow Jones Stoxx 600 is for a fifth session. 

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Cheat Sheet

The market always has taken the Fed's forecast for three rate hikes next year with a large dose of skepticism. The fed funds futures strip implies growing expectations that the Fed pauses after a hike in December and Q1 19. It is still unclear the direction of fiscal policy next year. It may be difficult for the Democrats to oppose making middle-class tax cuts permanent and an infrastructure initiative cannot be ruled out.

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FX Daily, November 19: Does Monday’s Calm mean a Storm is Around the Corner?

Overview: There is an uneasy calm in the global capital markets. Investors are digesting the weekend news, which includes the failure of APEC to issue a joint statement due to US-China tensions that we highlighted by dueling speeches by China President Xi and US Vice President Pence.

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FX Daily, November 16: Turning Brexit into a Dog’s Breakfast

Overview: It is the height of irony or tragedy that what was offered as a non-binding referendum on UK's membership in the European Union to bring the country, or at least the Tory Party, together is the most destabilizing event since the UK unceremoniously quit the European Exchange Rate Mechanism more than a quarter of a century ago. 

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FX Daily, November 15: UK Political Drama Roils Sterling

Overview: The resignation of the UK's Brexit negotiator after Prime Minister May had secured support from a majority of the cabinet sent sterling sharply lower.  Raab's resignation underscores the difficulty the Brexit agreement faces in the UK Parliament.  Sterling was hammered nearly 2.5 cents on the news and trade below $1.28.

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FX Daily, November 13: Weak Turn-Around Tuesday

Overview:  The US dollar has a heavier bias against most of the major and emerging markets currencies, but the pullback is shallow, and the greenback's underlying strength is still evident.  Asian equities were mixed.  Concern that Apple may be reducing orders weighed on suppliers, but news that China and US trade talks are resuming boosted sentiment, allowing Chinese stocks to recover helped lift the Australian and New Zealand dollars.

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FX Daily, November 07: Equities and Bonds Jump While the Dollar Slumps

The dollar has fallen against nearly every currency. It had been moving lower at the start of the week, but what seems like a correction broadened and deepened following the US midterm election. The outcome was largely in line with expectations for the Republicans to hold the Senate and the Democrats to take a majority of the House for the first time since 2010.

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FX Daily, November 6: US Goes to the Polls

Overview: The US dollar is narrowly mixed against the major currencies today, largely consolidating its recent losses. Equities are mixed.  In Asia, Japan, Australia, and Hong Kong equities gained around 1%, while most other bourses were softer.  In Europe, the Dow Jones Stoxx 600 is little changed in late morning turnover.

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FX Daily, November 01: Dollar Slumps to Start New Month

Overview: It appears that month-end considerations deterred the dollar selling that the technical indicators warned was coming and as the new month starts, the dollar is offered. It is weaker against all the major currencies and most of the emerging market currencies.

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FX Daily, October 31: No Fright on This Halloween

After sliding hard this month, equities continue to stabilize into month-end. All of the equity markets in Asia-Pacific rallied with the help of a solid close in the US. European bourses are higher too as the Dow Jones Stoxx 600 tries to extend the recovery for a third consecutive session, led by energy, materials, and information technology.

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FX Daily, October 29: Market Awaits US Leadership

The Dollar index is trading within last Friday's trading ranges. The year's high, set on August 15, was just shy of 97.00. The euro continues to straddle the $1.14 level but is spending more time in Europe below there. There is a 1.5 bln euro option expiring today at $1.1350 and an almost 600 mln euro option at $1.1400 that will be cut.

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FX Daily, October 23: Stock Slump Pushes Yields Lower and Buoys Yen

There is one main story today, and that is the resumption of the slide in equities. It is having a ripple effect through the capital markets. Bond yields are tumbling. Gold is firm. The dollar is narrowly mixed, though the yen stands out with almost a 0.5% gain. Most of the large equity markets in Asia, including Japan, China, Hong Kong, Korea, and Taiwan were off mostly 2%-3%.

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FX Daily, October 18: China’s Angst Stays Local

Asian equities were lower, led by a nearly 3% drop in Shanghai, while European shares shrugged it off and the Dow Jones Stoxx 600 is up about 0.4% in late morning turnover. The S&P 500 is off by about 0.25%. Global bond yields were dragged higher by US Treasuries where the 10-year yield is straddling 3.20% after rising four basis points yesterday.

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FX Daily, October 16: Semblance of Stability Returns

Overview:  Although the S&P 500 was unable to sustain early gains yesterday, the largely consolidative session was part of the stabilization of equities after last week's jump in volatility.  Asia and European stocks are also cautiously steadying.  Most Asia equity markets advanced with the Nikkei's 1.25% advance most bourses higher.  China was a notable exception, The Shanghai Composite recorded new lows for the year and finished uninspiringly on...

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Macro Cheat Sheet

The dollar's recovery ahead of the weekend was aided by the stabilization of the stock market, where the S&P 500 managed to close back above the psychologically important 200-day moving average. Interpolating from prices, the market does not expect the President's criticism to alter the Fed's course.

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FX Daily, October 12: Market Fever is Burning Itself Out Ahead of the Weekend

 Equity markets are stabilizing today as Asian and European markets shrug off the failure to get traction in the US yesterday.   As everything and nothing was behind the dramatic sell-off in recent days, the same could be said about today's recovery.  Most accounts seem to be emphasizing two developments:  a report indicating that despite the talk earlier in the week, there is a recognition by the US Treasury staff that China's actions do not reach...

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FX Daily, October 11: Equity Swoon Takes Spotlight, Pushes Dollar to Backfoot

There is one story today, and that is the sell-off in global equities. Although the narratives put the US at the center, the fact of the matter is that US equities have been among the best performers this year, despite the rise of interest rates and a President that is not above criticizing the central bank.

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Macro Cheat Sheet

Rising US rates in absolute terms and relative to other countries, coupled with the policy-mix and US tax reform are the main drivers. The market has nearly completely discounted three more Fed hikes by the end of next year, while the Fed has signaled that four hikes may be appropriate.

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