Tag Archive: British Pound

FX Daily, August 15: Dollar Eases to Start the New Week

2016-08-15

by

2016-08-15

The US dollar closed the pre-weekend session well off its lows that were seen in response to the disappointing retail sales report. It has been unable to sustain the upside momentum, and as North American dealers prepare to return to their posts, it is trading lower against most of the major currencies. The notable exceptions are the Scandi-bloc, which are consolidating last week's gains, and sterling, which remains pinned near $1.29.

Read More »

FX Weekly Preview: Thoughts on the Significance of Ten Developments

2016-08-14

by

2016-08-14

The GDP deflator may be just as important as overall growth for BOJ considerations and the possibility of fresh action next month. Falling UK rates and a weaker pound are desirable from a policy point of view. Dudley's press conference may be more important than FOMC minutes. Two German state elections that will be held next month comes as Merkel's popularity has waned.

Read More »

Weekly Speculative Positions: Switch to Small Net Long CHF

2016-08-14

by

2016-08-14

Speculators shifted to a 0.1 long Swiss Franc position in the week of August 9. Speculators reduced their exposure on Euro, CHF and Peso, increased it for NZD, CAD and GBP.

Read More »

FX Daily, August 12: Summer Markets Grind into the Weekend

2016-08-12

by

2016-08-12

There is a general consolidative tone in the capital markets as the week draws to a close. The US retail sales report may offer a brief distraction, but it is unlikely to significantly shift expectations about the trajectory of Fed policy. Indeed, it might not really change investors' information set.

Read More »

FX Daily, August 11: Sterling Struggles to Find a Bid, While RBNZ Can’t Knock Kiwi Down

2016-08-11

by

2016-08-11

Once again, EUR/CHF reverses in the middle of the week. A part from technical reasons, the weak French CPI (+0.4% YoY) and Italian CPI (-0.2% YoY) exercised downwards pressure on the euro. The US dollar has found steadier footing today after trading heavily yesterday. There are two main themes. The first is sterling’s heavy tone.

Read More »

FX Daily, August 10: FX Consolidation Resolved in Favor of Weaker US Dollar

2016-08-10

by

2016-08-10

European bourses are mixed, and this is leaving the Dow Jones Stoxx 600 practically unchanged in late-European morning turnover. Financials are the strongest sector (+0.4%), and within it, the insurance sector is leading with a 0.8% advance and banks are up 0.4%. The FTSE's Italian bank index is up 1.4% to extend its recovery into a fifth session.

Read More »

Bank of England QE and the Imaginary “Brexit Shock”

2016-08-09

by

2016-08-09

Mark Carney, Wrecking Ball. For reasons we cannot even begin to fathom, Mark Carney is considered a “superstar” among central bankers. Presumably this was one of the reasons why the British government helped him to execute a well-timed exit from the Bank of Canada by hiring him to head the Bank of England (well-timed because he disappeared from Canada with its bubble economy seemingly still intact, leaving his successor to take the blame).

Read More »

FX Daily, August 04: The BOE Owns Today, but Tomorrow is a Different Story

2016-08-05

by

2016-08-05

The Swiss Franc appreciated today against the euro. Given that the Bank of England started monetary easing, this slight appreciation is unexpectedly weak - reason was probably intervention. The SNB intervention level should be around 1 billion francs. Numbers revealed in next week's sight deposits.

Read More »

Carney Gets Ahead of Market Expectations; Sterling Slumps, Gilts Soar

2016-08-04

by

2016-08-04

BOE cuts rates and expands QE. Door is open to more easing. Sterling stabilizes after selling off 2 cents.

Read More »

FX Daily, August 03: Consolidation Featured

2016-08-03

by

2016-08-03

The US dollar is consolidating yesterday's losses. The greenback's upticks have thus far been shallow and unimpressive, except perhaps against the New Zealand dollar, which is off 0.8% ahead of next week's RBNZ meeting. Softer than expected labor cost increase reinforces the conviction that a 25 bp rate cut will be delivered next week.

Read More »

FX Daily, August 02: Greenback Slides Despite RBA Rate Cut and 7-year Low in UK Construction PMI

2016-08-03

by

2016-08-03

The US dollar is offered against the major currencies, but appreciating against many emerging market currencies, include the South African rand and Turkish lira. Oil prices are trying to stabilize with Brent near $42 and WTI near $40, but the recent losses continue to weigh on the Malaysian ringgit and the Mexican peso.

Read More »

FX Daily, August 01: Dog Days of August Begin

2016-08-01

by

2016-08-01

The US dollar is trading with a small upside bias in narrow trading ranges. The main news has consisted of PMI reports, while investors continue to digest last week's developments. In particular the BOJ's underwhelming response to poor economic data and a missed opportunity to reinforce the fiscal stimulus, and the dismal US GDP.

Read More »

FX Weekly Preview: After this Week, Does August Matter?

2016-07-31

by

2016-07-31

RBA meeting is a close call. BOE meeting consensus on rate cut, maybe new QE and lending-for-funding. More details of Japan's fiscal policy. U.S. jobs data. After this week, and outside of RBNZ rate cut, August may be uneventful.

Read More »

FX Daily, July 28: Dollar Pulls Back Further Post-FOMC

2016-07-28

by

2016-07-28

After reversing lower yesterday after the FOMC statement, the US dollar has continued to move lower against the major currencies, save sterling. While the market is not fully confident of a rate cut by the Reserve Bank of Australia, indicative pricing in the derivative markets suggest a UK rate cut has been fully discounted (and a new asset purchase plan may also be announced).

Read More »

FX Daily, July 27: Yen Falls on Fiscal Stimulus, while Sterling and Aussie Can’t Sustain Upticks

2016-07-27

by

2016-07-27

Swiss Franc: The Euro kept on climbing, after yesterday's rapid rise. The Swiss consumption indicator by UBS shows improvements. The indicator is still distant from the highs in 2012. At the time stronger growth in Emerging Markets and the weaker franc helped the Swiss economy.

Read More »

FX Daily, July 26: Strange Day: Yen Soars , Swissie Falls

2016-07-27

by

2016-07-27

The Swiss Franc strangely depreciated on a day, when the other safe-haven, the yen strongly improved. The euro went up to 1.0899 by 0.54%. The reason seems to be technical.

Read More »

FX Daily, July 25: Big Week Begins Slowly

2016-07-25

by

2016-07-25

What promises to be a busy week has begun off slowly. The US dollar has been largely confined to its pre-weekend ranges against most of the major currencies. Equity markets are mostly firmer following the new record highs on Wall Street. The MSCI Asia Pacific Index eked out a small gain (0.1%), with losses in Japan, Taiwan, and Singapore offsetting gains elsewhere.

Read More »

FX Daily, July 22: Flash PMIs Show Brexit Impact Localized

2016-07-22

by

2016-07-22

As the week draws to a close, there are three main developments in the capital markets. First, the profit-taking seen in US equities yesterday has continued in Asia and Europe today. The MSCI Asia Pacific Index and the Dow Jones Stoxx 600 in Europe are both off around 0.5%.

Read More »

FX Daily, July 21: Monetary Policy Expectations are Driving Foreign Exchange

2016-07-21

by

2016-07-21

Monetary policy is said to have lost its impact on the foreign exchange market, as investors scratch their heads at the resilience of currencies with negative interest rates. Yet the price action in the action cannot be understood without recognizing the ongoing importance of monetary policy expectations.

Read More »

FX Daily, July 20: Sterling’s Jump Slows Dollar’s Ascent

2016-07-20

by

2016-07-20

It is a bizarre turn of events. Just like the Game of Throne's Westeros is a map of the UK put on top of an inverted Ireland, so too do UK events seem to be a strange permutation of the pre-referendum views. Although sterling and interest rates have not fully recovered from the Brexit decision, equity markets have, and fear of contagion has died down.

Read More »