Tag Archive: Italy

FX Daily, September 05: Continuing EM Pain Helps the Dollar, but does Little for Yen

The dollar is posting gains against most of the emerging market and major currencies. The MSCI Emerging Markets Index is off 1.6% and extending the drop to a sixth consecutive session. Indonesia's bourse saw the largest decline (~3.75%) in the region. In part, it reflects concern that the rupiah's weakness (falling now nine of the past 10 sessions) will boost corporate debt servicing costs.

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FX Weekly Preview: Trade Trumps US Jobs and Rising Stress in Spain and Italy is More Important than the PMI

The first week of a new month features the US jobs data.  It is the most important economic report of a new month.  It sets the broad tone for much of the economic data over the next several weeks,  including consumption, industrial production, and construction spending. However, there are two reasons why it may not pack the punch it has in the past. 

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FX Weekly Preview: Dog Days of August Begin

With most of the major central bank meetings and important economic data out of the way, the dog days of August are upon us. In terms of drivers, it means that players will have to look elsewhere for inspiration and it means that market liquidy is likely not at its best.

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FX Daily, June 12: US-Korea Summit Fails to Impress Investors

The US dollar initially rallied in early Asia ahead of the US-North Korea summit but has subsequently shed the gains and more. As North American dealers return to their desks, the dollar is lower against nearly all the major currencies, but the yen and Canadian dollar. 

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FX Daily, May 31: Don’t Confuse Calmer Markets with Resolution

The global capital markets that were in panic mode on Tuesday stabilized yesterday, and corrective forces have carried into today's activity. However, the underlying issues in Italy and Spain are hardly clarified in the past 48 hours. Moreover, the US push on trade is intensifying again.

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FX Daily, May 30: Italian Reprieve, Euro Bounces, Trade Tensions Rise

After what could be described as a 15-sigma event yesterday in the Italian bond market, a reprieve today has seen the euro recover a cent from yesterday's lows. While the political situation in Italy is worrisome, many observers suspect that the new banking rules exacerbated the illiquidity that explains outsized moves.

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What Happened Monday?

Italian politics dominated Monday's activity. Initially, the euro reacted positively in Asia to news that the Italian President had blocked the proposed finance minister. A technocrat government would be appointed to prepare for new elections.

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Great Graphic: Euro-Swiss Shows Elevated Systemic Risk

The Swiss National Bank's decision in January 2015 to remove the cap on the Swiss franc (floor on the euro) that it has set at CHF1.20 is seared into the memory of a generation of foreign exchange participants. It is not exactly clear where the euro bottomed in the frenzied activity that followed the SNB's surprise move. Bloomberg records the euro's low near CHF0.8520.

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Italy Defies Gravity and Risk to Fiscal Rectitude

Italian asset markets continue to fare better than many expected. The political uncertainty following the March election has been followed by confidence that the Five Star Movement and the (Northern) League will be able to put together a government in the coming days. If so, Italy would have taken half the time Germany did to cobble a government together after inconclusive elections.

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FX Daily, May 18: EUR/CHF Continues the Collapse

The US dollar is mostly firmer. US yields have stabilized. Asian equities were mostly higher, while European bourses are struggling. Oil prices are steady. There have been a number of sustained trends in the markets that we have been monitoring. The euro, for example, has fallen each day this week. It recorded its low for the year on Wednesday near $1.1765.

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FX Daily, May 16: US Yields Soften After Yesterday’s Surge

The US dollar is mixed today after the Dollar Index rose to new 2018 highs yesterday.  It is being driven by rising US rates, which also punishes short dollar positions. The US 10-year yield rose seven basis points yesterday to nearly 3.10%.  It is consolidating near 3.06% now.  Many see the yield rising toward 3.20%, which would match the mid-2011 high.

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FX Daily, March 06: Resiliency Demonstrated

The resiliency of the status quo is again on display. After much chin wagging and finger pointing after the Italian elections and the modest decline in Italian assets, they have bounced back today. Italian bonds and stocks are participating in today's advance. Italian equities were off 0.5% yesterday and are up a 1.1% near midday in Milan. Italy's 10-year yield rose three basis points yesterday is off five today.

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FX Daily, March 05: Italian Election Weighs on Italian Assets, but Little Systemic Risk Seen

The US dollar is narrowly mixed. The Japanese yen remains firm. The dollar appears stuck in a narrow range. Near JPY105.20 the seems to be some short-covering pressure in front of JPY105. On the top side, the greenback is encountering offers in front of JPY105.80. Sterling is firm against the dollar as it recovers against the euro. Before the weekend, the euro reached GBP0.8950, its best levels since last November. The euro is testing GBP0.8900...

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FX Weekly Preview: Recovering from Too Much of a Good Thing?

Too much of a good thing is bad. That, in a nutshell, is an important insight that Hyman Minsky offered about the financial sector, but has broader application. The low volatility that has been a characteristic of the capital markets for the past few years spurred financial innovation to profit from it.

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Italian Election–Two Months and Counting

Germany does not have a government, though the election was more than three months ago. Spain, Portugal, and Ireland have minority governments. Austria is the first government since the financial crisis to include the populist right. The EU is trying to press the Visegrad group of central European countries to conform to the values of Western European members.

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For The First Time Ever, The “1 percent” Own More Than Half The World’s Wealth: The Stunning Chart

Today Credit Suisse released its latest annual global wealth report, which traditionally lays out what has become the single biggest reason for the recent "anti-establishment" revulsion: an unprecedented concentration of wealth among a handful of people, as shown in Swiss bank's infamous global wealth pyramid, an arrangement which as observed by the "shocking" political backlash of the past year, suggests that the lower 'levels' of the pyramid are...

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FX Weekly Preview: Thumbnail Sketch of the Week’s Big Events

Busiest week of Q4. Fed, BOJ, and BOE, only the last is expected to change policy. Flash EMU CPI and US jobs. Positive developments in Italy, less so in Spain.

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Why Small States Are Better

Andreas Marquart and Philipp Bagus (see their mises.org author pages here and here) were recently interviewed about their new book by the Austrian Economics Center. Unfortunately for English-language readers, the book is only available in German. Nevertheless, the interview offers some valuable insights.

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Dollar Surge Continues Ahead Of Jobs Report; Europe Dips As Catalan Fears Return

World stocks eased back from record highs and fell for the first time in eight days, as jitters about Catalonia’s independence push returned while bets on higher U.S. interest rates sent the dollar to its highest since mid August; S&P 500 futures were modestly in the red - as they have been every day this week before levitating to record highs - ahead of hurricane-distorted nonfarm payrolls data (full preview here). U.S. jobs report will also be...

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“This Is A Crisis Greater Than Any Government Can Handle”: The $400 Trillion Global Retirement Gap

Today we’ll continue to size up the bull market in governmental promises. As we do so, keep an old trader’s slogan in mind: “That which cannot go on forever, won’t.” Or we could say it differently: An unsustainable trend must eventually stop. Lately I have focused on the trend in US public pension funds, many of which are woefully underfunded and will never be able to pay workers the promised benefits, at least without dumping a huge and unwelcome...

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