Tag Archive: EUR/CHF

FX Daily, August 7: Three Asian Central Banks Surprise Investors

2019-08-07

by

2019-08-07

While investors keep a watchful eye on the dollar fix in China (a little firmer than projected) and tensions with the US, two other developments compete for attention. The Reserve Bank of New Zealand and the central banks of India and Thailand surprised the market with lower rates. The RBNZ cut by 50 bp, India by 35 bp, and the fact that Thailand cut at all was unexpected.

Read More »

FX Daily, August 6: Markets Stabilize with Help of CNY Fix in Muted Turnaround Tuesday

2019-08-06

by

2019-08-06

Overview: The escalation of the economic conflict between the world's two largest economies is dominating the capital markets.  The US cited China as a currency manipulator after the North American markets closed, ensuring the troubled start to Asian trading after the US equities and yields plummeted on Monday.  The VIX surged to 25%, doubling in the past week.

Read More »

FX Daily, August 5: China Strikes Back

2019-08-05

by

2019-08-05

Overview:  Chinese officials took the US tariff hike quietly last week but struck back today.  The PBOC fixed the dollar higher (CNY6.90), which it has not done, and will halt imports of US agriculture. The dollar shot through CNY7.0 to finish the mainland session a little above CNY7.03 and CNH7.07 for the offshore yuan. 

Read More »

FX Daily, August 2: End of Tariff Truce Trumps Jobs

2019-08-02

by

2019-08-02

Overview: The market was finding its sea legs after being hit with wave and counter-wave following the FOMC decision, and more importantly, Powell's attempt to give insight into the Fed's thinking. Trump's tweet than signaled an end to the tariff truce with a 10% levy on the $300 bln of imports from China that have not been subject to action previously.

Read More »

FX Daily, August 1: Mid-Course Correction Sends Greenback Higher

2019-08-01

by

2019-08-01

Overview:  The Federal Reserve delivered the first rate cut since the Great Financial Crisis but couched it in terms of a mid-course correction rather than the start of a larger easing cycle.  By doing so, Fed chief Powell cast the cut in less dovish terms than the market expected and the reaction function of the market has been clear. 

Read More »

FX Daily, July 31: Sterling Steadies, Attention Shifts to FOMC

2019-07-31

by

2019-07-31

Overview: After a shellacking in recent days, sterling has stabilized though there is not much of a bounce to speak of, suggesting the adjustment to the risk of a no-deal Brexit may not be complete. After the S&P 500 posted back-to-back declines, Asia Pacific equities struggled. Hong Kong shares led the regional decline.

Read More »

FX Daily, July 30: Sterling Pounded

2019-07-30

by

2019-07-30

Overview:  The prospect of a no-deal Brexit continues to pound sterling lower.  A little more than two months ago, it was testing $1.32.  Two weeks ago it was around $1.25.  Today it traded near $1.2120 before stabilizing.  On the other hand, the 10-year Gilt yield is below 65 bp, a new multiyear low, while the international-laden FTSE 100 is holding its own in the face of heavier equity prices in Europe.

Read More »

FX Daily, July 29: Prospects of a No-Deal Brexit Weigh on Sterling

2019-07-29

by

2019-07-29

Unrest in Hong Kong and disappointing earnings reports from South Korea weighed on local equity markets, and the MSCI Asia Pacific Index fell for the third consecutive session. European equities are edging higher in tentative trading. The Dow Jones Stoxx 600 is firmer for the sixth session of the past seven. US shares are little changed after record-high closes before the weekend.

Read More »

FX Daily, July 26: Markets Consolidate as the Dollar Index Extends its Advance for the Sixth Consecutive Session

2019-07-26

by

2019-07-26

Investors are happy for the weekend. Between the ECB, Brexit, and next week's FOMC, BOJ, and BOE meetings, the markets are mostly in a consolidative mode ahead of the weekend. The first look at Q2 US GDP is the last important data point of the week, though it is unlikely to impact next week's Fed decision.

Read More »

FX Daily, July 24: Poor PMI Weighs on Euro Ahead of ECB

2019-07-24

by

2019-07-24

EUR/CHF and USD/CHF, July 24
Overview:  Disappointing flash PMI pushed an already offered euro lower ahead of tomorrow's ECB meeting. European bonds rallied and equities, amid a rash of earnings, is trying to extend the advance for a fourth consecutive session.  Italian and Spanish 10-year benchmark yields are off four-six basis points, while core bond yields are off two-three basis points.

Read More »

FX Daily, July 23: Debt Deal Help Lifts the Dollar

2019-07-23

by

2019-07-23

The gains in US equities and the apparent US budget agreement has underpinned equities today and the US dollar. Asia Pacific equities recouped yesterday's losses, and Europe's Dow Jones Stoxx is posting gains for the third consecutive session, helped by some earning beats, to probe two-week highs. US shares are firmer. Benchmark 10-year yields are mixed with the Asia Pacific softer and European firmer.

Read More »

FX Daily, July 19: Dollar Pares Losses as Market Partly Corrects Confusion of Magntiude and Timing of Fed

2019-07-19

by

2019-07-19

Overview: Comments underscoring the importance of acting preemptively by two Fed officials sent the dollar reeling and helped lift equities after the S&P fell to a two and a half week low. The decline in rates and the US shooting down of an Iranian drone in the Gulf helped spur gold to new six-year highs. There was some attempt to clarify the (NY Fed's) comments and the dollar has pared yesterday's losses.

Read More »

FX Daily, July 18: Dollar on Back Foot as Equities Slide

2019-07-18

by

2019-07-18

Overview:  Profit-taking continues to weigh on global equities earnings concerns saw the biggest drop in the S&P 500 in three weeks.  The MSCI Asia Pacific Index fell for the fourth consecutive session.  The Nikkei gapped lower for the second straight session and has now retraced half of the gains scored since early June.  The Shanghai Composite is at its lowest level in a month.

Read More »

FX Daily, July 17: Back to the Well Again

2019-07-17

by

2019-07-17

Overview:  After slapping punitive tariffs on structural from China and Mexico last week, US President Trump threatened to end the tariff truce with China because it is not stepped up its purchases of US agriculture products.  Trump said the tariff freeze was in exchange for ag purchases, but at the time it seemed as if granting licenses to US companies to sell to Huawei was the quid pro quo.

Read More »

FX Daily, July 16: Sterling Weakness Punctures Subdued Session

2019-07-16

by

2019-07-16

Overview: Summer in the northern hemisphere contributing to the subdued activity in the global capital markets. The MSCI Asia Pacific index stalled after a four-day advance, with Japanese, Chinese, and Australian equities offsetting gains in Taiwan, South Korea, and India.  Europe's Dow Jones Stoxx 600 is flattish, struggling to extend its three-day rally.

Read More »

FX Daily, July 15: Marking Time on Monday

2019-07-15

by

2019-07-15

Overview: The new record highs in US equities ahead of the weekend coupled with Chinese data that suggested the economy was gaining some traction as Q2 wound down is helping underpin risk appetites to start the week. Japanese markets were closed today, but equities were mostly firmer in the Asia Pacific regions, markets in China, Hong Kong, Taiwan, and India firmed. 

Read More »

FX Daily, July 12: Greenback Limps into the Weekend

2019-07-12

by

2019-07-12

Overview:  Higher than expected US CPI and the second tepid reception to a US bond auction this week pushed US yields higher and helped stall the equity momentum. Asia Pacific yields, especially in Australia and New Zealand jumped 8-10 bp in response, and Spanish and Portuguese bonds bore the burden in Europe. 

Read More »

FX Daily, July 11: Powell Spurs Equity and Bond Market Rally, While the Greenback Falls Out of Favor

2019-07-11

by

2019-07-11

Overview:  Fed's Powell confirmed a Fed rate cut at the end of this month by warning that uncertainties since the June FOMC had "dimmed the outlook" and that muted price pressures may be more persistent.  It ignited an equity and bond market rally (bullish steepening) while the dollar was sold.

Read More »

FX Daily, July 10: North American Focus: Poloz and Powell

2019-07-10

by

2019-07-10

Overview: The US Treasury market is retreating for the fourth consecutive session ahead of Fed Chairman Powell's testimony before Congress. It is the longest losing streak in six months, and the 10-year yield has risen 15 bp over the run. This is helping drag up global yields, and today Asia Pacific yields mostly rose 2-3 basis points while core European bond yields are 5-7 bp higher and peripheral yields up a little less.

Read More »