Tag Archive: macro

Week Ahead: Dollar and Stocks Due for Corrections?

2026-04-18

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2026-04-18

(No daily note this week while I am on a business trip but the May monthly will drop April 24. Thanks for your patience.)Progress in US-Iran negotiations and a ceasefire between Israel and Lebanon fed investor optimism. The US S&P 500 and Nasdaq reached new record highs, with multi-week rallies in tow. June WTI tumbled …

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Week Ahead: Hope Springs Eternal

2026-04-11

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2026-04-11

Hope that the ceasefire will lead to the end of the Middle East war fanned risk appetites in recent days. Equities rallied broadly. May WTI and June Brent fell by nearly 11.5%. The dollar fell against all the G10 currencies, the Antipodeans and Scandis, which seem the most sensitive to growth prospects and the risk … Continue reading...

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Week Ahead: It’s Still Mostly about the War

2026-04-04

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2026-04-04

The Middle East war remains the dominant fundamental condition. There continues to be some indication that market participants are hopeful of a resolution soon. The May WTI contract settled near $111.55 last week, which appears to build in the risk of near-term escalation, but the June contract settled close to $98. The September contract is …

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April 2026 Monthly

2026-03-28

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2026-03-28

Wars rarely stay where they start. The Israeli and American military campaign against Iran—the most direct confrontation with Tehran in decades—has sent shockwaves well beyond the Middle East. The fog of war obscures the tactical picture almost daily, but the economic transmission mechanisms are clear enough, and investors who mistake this for a regional skirmish …

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Week Ahead: The War and Anticipated Policy Responses Drive the Capital Markets

2026-03-21

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2026-03-21

There are two main drivers in the foreign exchange market: war and the anticipated monetary policy response. May WTI peaked on March 9 near $113.40. Last week, the average close was a little below $95. Brent has been hit harder but it also peaked on March 9 (~$119.50), The five-day average close is about $105.50. …

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Week Ahead: Eight of the G10 Central Banks Meet, Maybe One Moves

2026-03-14

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2026-03-14

The Middle East War dominates the investment climate. The inflationary implications are first order considerations and there has been a large swing in expectations of central bank policy this year. Japan is a notable exception as the swaps market continues to discount almost two hikes this year. Eight of the G10 central banks meet in …

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Week Ahead: War and More War

2026-03-07

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2026-03-07

The Middle East war changes everything. And President Trump's demand for an unconditional surrender makes a near-term off-ramp more difficult to envision. Moreover, the impact ripples through a wide swath the global economy. Food is very oil and gas intensive, taking into account transportation, fertilizer, and pesticides. Worker remittances are important to many developing nations …

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March 2026 Monthly

2026-02-28

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2026-02-28

March seems to be more about the unfolding of current forces driving the capital markets, rather than new forces or policies. All the G10 central banks but the Reserve Bank of New Zealand meet in March, and none are likely to change policy. China formalizes its next Five-Year Plan. In the US, the Supreme Court's ruling … Continue reading...

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Week Ahead: Does the Dollar Still Have Legs After the Tariff Ruling?

2026-02-21

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2026-02-21

The Supreme Court struck down President Trump's use of emergency powers to impose widespread tariffs. The court did not rule on refunds. Trump quickly announced a 10% across-the-board tariff under Section 122 of the 1974 Trade Act, which allows the president to impose up to 15% tariff for 150 days. The dollar remained firm after …

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Week Ahead: SCOTUS Decision on Tariffs? 8 Fed Officials Speak as the Market Discounts almost 65 bp of Cuts this Year

2026-02-14

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2026-02-14

Last week began with the LDP's stunning victory in Japan. However, rather than sell-off as the market expected, the yen and JGBs rallied. It appears that the yen's use as a levered funding leg for carry trades had already been adjusted. At the start of the week, reports circulated that Chinese officials were encouraging local …

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Week Ahead: Does the Dollar’s Upside Correction have more Room to Run?

2026-02-07

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2026-02-07

The US dollar rose against the G10 currencies last week but the Australian and New Zealand dollars. Without much in the way of new supportive developments, we frame its gains primarily in technical terms after the dramatic sell-off the appears to have been spurred by the bellicose nature of the US attitude toward Greenland. The …

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February 2026 Monthly

2026-01-31

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2026-01-31

The revival of the Roosevelt Corollary to the Monroe Doctrine under President Trump's "Donroe Doctrine" marks a turning point in U.S. foreign policy. Washington reportedly carried out hundreds of airstrikes across seven countries in 2025, from Yemen to Nigeria. The new year began with the forcible removal of Venezuela's strongman Maduro and threatening to take …

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Week Ahead: Standpat Fed, Bank of Canada, and Norges Bank, while Cat-and-Mouse with Officials on Yen Continues

2026-01-24

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2026-01-24

President Trump backed away from threatening to use force to acquire Greenland and dropped the tariffs on several European countries slated to go into effect on February 1. Europe's threat to break from the recent trade agreement with the US was also rescinded. After a rough start to the week, another source of market stress, …

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Week Ahead: Dollar’s Upside Correction Since around Christmas may be in the Final Phase

2026-01-17

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2026-01-17

The US dollar mostly consolidated against the G10 currencies last week, though the combination of firm data and the shrugging off of the latest administration attempt to influence Fed policy gave it a firmer bias.  Japanese officials have taken several steps up the intervention ladder with verbal threats and this has stabilized the yen, without …

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Week Ahead: Additional Scope for the US Dollar to Extend the Upside Correction

2026-01-10

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2026-01-10

After trending lower from late November through late December, the US dollar has begun the new year on firmer footing. The retracement of the losses in late 2025 has been encouraged by data that strengthens the market's conviction that like last year, the Federal Reserve will begin this year with an extended pause that may …

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January 2026 Monthly

2026-01-03

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2026-01-03

The coming year begins under the long shadow of geopolitical tensions and the unfolding of a new transformative technology, artificial intelligence—a technology that in 2025 proved both a backbone and a fault line for the U.S. economy. The resurrection of the US Monroe Doctrine, Russia's hybrid war in Europe and its aggressive campaign in Ukraine, …

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Next Week: Six G-10 Central Banks Meet, But Only Two Move–BOE Cuts and BOJ Hikes

2025-12-13

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2025-12-13

Encouraged by the Federal Reserve's rate cut and its T-bill purchases, the dollar was sold. The Dollar Index fell for the fourth week in the past five. Leaving aside the Bank of England, which will most likely cut rates in the week ahead, the easing cycle of most of the other G10 central banks appears …

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Week Ahead: Fed to Cut but RBA, SNB, and Bank of Canada Set to Hold, and Market Thinks They are Done

2025-12-06

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2025-12-06

The US dollar traded heavily last week, losing ground to all the G10 currencies, but the Swiss franc. The franc seemed to be dragged down by the use of it rather than the yen as a funding currency. Japanese officials protested the pace of the yen's weakness, while Swiss authorities seem to welcome the franc's …

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December 2025 Monthly

2025-11-29

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2025-11-29

This year marks an inflection point. The re-election of Donald Trump as the US president in 2024 in part reflects an ongoing reevaluation of America’s place in the world by Americans themself. In an idiosyncratic way, and perhaps not fully conscious, the Trump administration’s rhetoric and actions signal the American political elite recognizing the long …

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Week Ahead: Will Renewed Speculation of Fed Cut Next Month Cap the Greenback?

2025-11-22

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2025-11-22

All of the G10 currencies weakened against the dollar last week, and six fell by more than 1%. With the help of an explicit threat to intervene by Japan's Ministry of Finance, the yen bounced almost 0.7% before the weekend and lifted off the 10-month low. The Swiss franc was the weakest of the major … Continue...

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