Tag Archive: $JPY

FX Daily, September 21: Market Digests Fed, Greenback Consolidates, Antipodeans Tumble

2017-09-21

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2017-09-21

The market has mostly interpreted the Fed's action in line with our thinking. Despite the lowering of the long-run Fed funds rate, the shifting one of the three hikes from 2019 into 2020, and recognizing that the weaker price impulses are somewhat mysterious, the Fed clearly signaled its bias toward hiking rates one more time this year and three next year.

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FX Daily, September 20: Shrinkage and Beyond

2017-09-20

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2017-09-20

After much anticipation, the FOMC decision day is here. Much of the focus is on the likely decision that the Fed will allow its balance sheet to shrink gradually. No other country who employed quantitative easing has is in a position to begin unwinding the emergency expansion of its balance sheet. The Fed's experience in QE, communication, and now unwinding, will be part of the information set other central banks can draw upon.

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FX Daily, September 18: More Thoughts from Berlin

2017-09-18

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2017-09-18

The unexpected weakness in US retail sales and industrial production reported before the weekend did not prevent US yields and stocks from rising.  Asia followed suit, and with Japanese markets closed, the MSCI Asia Pacific Index rallied a little more than 1%, the largest gain in two months.  Of note, foreigners returned to the Korean stock market, buying about $260 mln today, which cuts the month's liquidation in half.  The Kospi rallied 1.3%...

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FX Weekly Preview: FOMC Highlights Big Week

2017-09-18

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2017-09-18

The days ahead are historic. By all reckoning, Merkel will be German Chancellor for a fourth consecutive term. Many observers expect the election to usher in a new era of German-French coordination to continue the European project post-Brexit and in the aftermath of the Great Financial Crisis.

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FX Daily, September 15: Short Note Ahead of the Weekend

2017-09-15

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2017-09-15

Sporadic updates continue as the first of two-week business trip winds down. North Korea missile launch failed to have much impact in the capital markets. The missile apparently flew the furthest yet, demonstrating its ability to hit Guam. However, there was not an immediate response from the US. South Korea said it had simultaneously conducted its own drill which included firing a missile into the Sea of Japan (East Sea).

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FX Daily, September 14: New Trump Tactics Help Greenback and Rates

2017-09-14

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2017-09-14

In the face of much cynicism and pessimism about the outlook for the Trump Administration's agenda, we have repeatedly pointed out the resilience of the system of checks and balances. Many of the more extreme positions have been tempered, either on their own accord, such as naming China a currency manipulator or pulling out of NAFTA or KORUS, or the judiciary branch, such as on immigration curbs, or the legislative branch itself, as in limiting the...

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FX Daily, September 13: Sterling Shines While Euro Stalls in Front of $1.20

2017-09-13

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2017-09-13

The next leg of the business trip takes me to Frankfurt. Sporadic updates will continue. We have been identifying the $1.3430 area is a reasonable technical target for sterling. It represents the 50% retracement of sterling's losses since the day of the referendum June 2016 when it briefly traded $1.50. Also helping sterling is the unwinding of short cross positions against the euro.

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FX Daily, September 12: Dollar Sports Heavier Tone as Yesterday’s Bounce Runs out of Steam

2017-09-12

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2017-09-12

The sporadic updates continue while I am on a two-week business trip. Now in Barcelona, participating in TradeTech FX Europe. The euro advanced yesterday from NOK9.30 to NOK9.40. It is consolidating in a tight range today. The election results may have been a bit closer than expected, but the weight on the krone yesterday seemed to stem more from the unexpectedly soft inflation report.

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FX Weekly Preview: Forces of Movement in FX: The Week Ahead

2017-09-11

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2017-09-11

The dollar has been declining since the start of the year, but the causes have changed. The drag from US politics may be exaggerated, while European and Japanese politics are worrisome. The economic data may continue to be a drag on US yields, especially if core CPI slips again.

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FX Daily, September 08: US Dollar Tracks Yields Lower

2017-09-08

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2017-09-08

The US dollar has been unable to find any traction as US yields continue to move lower. The US 10-year year is slipping below 2.03% in European turnover, the lowest level in ten months. The risk, as we have noted, is that without prospects of stronger growth and inflation impulses, the yield returns to where was before the US election (~1.85%). The two-year note yield, anchored more by Fed policy than the long-end,  is also soft. It yielded 1.25%...

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FX Daily, September 07: ECB Focus for Sure, but not Only Game in Town

2017-09-07

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2017-09-07

The US dollar is trading broadly lower. The ECB meeting looms large. Many, like ourselves, expected that when Draghi said in July that the asset purchases would be revisited in the fall, it to meant after the summer recess, not a legalistic definition of when fall begins. Still, there have been some reports, citing unnamed sources close to the ECB, that have played down such expectations, and warn a decision on next year’s intentions may not be...

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FX Daily, September 06: Wake Me up when September Ends

2017-09-06

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2017-09-06

The US dollar fell to new lows since mid-2015 against the Canadian dollar yesterday. It is flattish today as the market awaits the central bank's decision. We are concerned that given the strong performance and market positioning, a rate hike could spur "buy the rumor, sell the fact" activity. Alternatively, a disappointment if the Bank does not hike could also lead to some Canadian dollar sales.

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FX Daily, September 5: Greenback Mixed, North Korea and PMIs in Focus

2017-09-05

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2017-09-05

Reports suggesting that North Korea is moving an ICBM missile toward launch pad in the western part of the country at night to minimize detection, while South Korea is escalating its military preparedness and the US seeks new sanctions, keep investors on edge. Risk assets are mixed. Gold is slightly lower. While the yen is stronger, the Swiss franc is heavier. Asia equities slipped, and European shares are recouping much of yesterday's 0.5% loss.

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FX Daily, September 01: Manufacturing PMIs, US Jobs, and Implications of Harvey

2017-09-01

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2017-09-01

As the markets head into the weekend, global equities are firmer, benchmark 10-year yields are mostly lower, and the dollar is consolidating after North American pared the greenback's gains yesterday. Manufacturing PMIs from China, EMU, and the UK have been reported, while in the US, the August jobs data stand in the way of the long holiday weekend for Americans.

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FX Daily, August 31: US Core PCE Deflator may Challenge the Greenback’s Firmer Tone

2017-08-31

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2017-08-31

The US dollar recovery was marginally extendedin Asia, and while it remains firm, it is lost some of its momentum. The Fed's target inflation measure, the core PCE deflator, may decline from 1.5% to 1.4%, according to the median forecast in the Bloomberg survey. That would be the lowest read since the end of 2015 and likely spur more speculation against another Fed hike before the end of the year.

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FX Daily, August 30: US Dollar Recovery Extended

2017-08-30

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2017-08-30

The US dollar recovery that began in North American yesterday continued to in Asia and Europe. The geopolitical anxiety sparked by North Korea's missile over Japan subsided. The US response was seen as measured and tempered.

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FX Daily, August 29: Dollar Losses Accelerate After North Korea Sends Missile over Japan

2017-08-29

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2017-08-29

A brief period of quiet, which some may have confused with a change in posture, North Korea followed up the weekend's test of three ballistic missiles with what appears to have been an intermediate missile that flew over Japan. South Korea responded with its own symbolic display of force by dropping bombs by the DMZ.

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FX Daily, August 28: Monday’s Dollar Blues

2017-08-28

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2017-08-28

The US dollar's pre-weekend losses were extended initially in Asia before it recovered sufficiently to give European participant a better selling level. The dollar selling into the shallow bounce reflects the bearish sentiment, which as we see it, was simply fanned by both Yellen and Draghi did not alter the status quo in their Jackson Hole speeches.

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FX Daily, August 25: Is the Janet and Mario Show a New Episode or Rerun?

2017-08-25

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2017-08-25

The event that investors have been waiting for and the media frequently linked to whatever price action has taken place has arrived: Yellen and Draghi's speeches later today. Yellen is first. She will speak at 10:00 am ET. This is toward the end of the European trading week. Draghi speaks late in the North American session--3:00 pm ET.

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