Tag Archive: Riksbank

Serenity Now

2024-11-07

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2024-11-07

Overview:  The markets are calmer after yesterday's post-US election drama. A consolidative tone has emerged in the foreign exchange market, and the dollar is softer against all the G10 currencies, led the 1% gain in the Norwegian krone, after the central bank left rates on hold. Sweden's Riksbank delivered the expected half-point cut and the krona is up 0.5%. Japanese officials warned against excessive moves, and the PBOC set the dollar's...

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US Dollar Soars and US Rates Jump

2024-11-06

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2024-11-06

Overview: Shortly after the North American markets closed, before any results were known, the market jumped back into the "Trump trade," which it had pared on Tuesday. The dollar and US interest rates soared. The euro is the hardest hit among the G10 currencies today, off about 1.6% and the Canadian dollar, the best performer … Continue...

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Nervous Calm Hangs over the Markets

2024-11-05

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2024-11-05

Overview: A nervous calm hangs over the markets as the US goes to the polls. The proximity of the presidential contest warns that the results may not been known as soon as people hope. Indeed, many fear the voting simply begins the next phase of the contest, with premature declarations of victory and disputes over votes. The dollar is in mostly narrow ranges today, but the Antipodeans and Scandis are the strongest, and the Reserve Bank of Australia...

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US Polls Spur Position Adjusting Ahead of Tomorrow’s Election

2024-11-04

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2024-11-04

Overview: Weekend polls in the US made it seem that the Trump victory, which many large pools of capital, had discounted, was not so inevitable after all. The most dramatic market response was taking US yields and the dollar lower. The US 10-year yield is off about nine basis points to straddle 4.30% and the two-year yield down four basis points to around 4.16%. The greenback is also against all the G10 currencies. Most emerging market currencies...

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Ueda Lifts Yen, Stocks Slump, Gilts Under Pressure Post-Budget

2024-10-31

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2024-10-31

Overview: The main move in the foreign exchange market today is the recovery of the yen following what was seen as hawkish comments by BOJ Governor Ueda. Otherwise, the tone is one of consolidation. The equity market sell-off today may be weighing on the Scandis and dollar-bloc currencies amid risk-off impulses. Emerging market currencies are mixed. The Mexican peso, which fell to a new low for the year yesterday, is stabilizing today and is among...

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Run on the Dollar Stalls after the Market Boosted Odds of another 50 bp Fed Cut

2024-09-25

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2024-09-25

Overview: Weak US consumer confidence, especially regarding the labor market boosted speculation of another half-point Fed cut in November when the central bank meets again. This weighed on the dollar. Sterling and the Australian dollar rose to new 2 1/2-year highs. The PBOC followed up yesterday's package with a 30 bp cut in the one-year Medium-Term Lending rate. After extending its losses earlier today, the dollar has steadied and turned higher...

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China Goes Big, and Market (Initially) Gives it the Benefit of the Doubt

2024-09-24

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2024-09-24

Overview: News of China's multifaceted support measures have bolstered risk appetites today. The dollar is mostly softer and only the yen and Swiss franc among the G10 currencies have been unable to find traction against the greenback. Most emerging market currencies are also trading with a firmer bias. China's measures include measures to support the stock and housing markets. The seven-day repo rate was cut by 20 bp (to 1.50%) and reserve...

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USD Remains Soft but Consolidation is Threatened

2024-08-20

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2024-08-20

Overview: The US dollar's recent retreat has been marginally extended today but it seems to be moderating. Still, the greenback is on the defensive, arguably ahead of tomorrow's BLS annual revisions of nonfarm payrolls, where there is talk that April 2023-March 2024 job growth could be slashed from 2.9 mln to 1.9 mln. And that is ahead of Friday's Jackson Hole address by Fed Chief Powell that is expected to be the strongest confirmation of a rate...

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The Greenback Consolidates while Sustaining Break against the Yen

2024-06-27

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2024-06-27

Overview: The dollar is sporting a softer profile today against all the G10 currencies but the Swedish krona. The Riksbank sounded more dovish than previously, signaling the possibility of a cut in each of the last three meetings of the year. The dollar has sustained its push above JPY160 against the Japanese yen. Most emerging market currencies are also firmer, with the notable exception of Türkiye and South Africa. Türkiye is expected to keep its...

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Self-Inflicted Wounds in Europe and Japan Help the Greenback Shrug Off the Drag of Lower Rates

2024-06-14

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2024-06-14

Overview: The dollar is bid. What makes its performance standout is that it is taking place as US rates have fallen. The US 10-year yield is near 4.20%, the lowest in more than two months. The two-year yield is near 4.67%. It has fallen every session this week for a cumulative decline of more than 20 bp. It is not so much that constructive developments took week, but that Europe and Japan are suffering from self-inflicted injury. Macron's call for...

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Riksbank Cuts, Oil Slips, and the Yen Remains Under Pressure

2024-05-08

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2024-05-08

(On business trip over next few days. Commentary to resume Monday.  Thanks for your patience.) Overview: Sweden's Riksbank became the second G10 central bank to cut rates this year. The Swiss National Bank cut its deposit rate in March. A couple other large central banks, including the European Central Bank, and possibly the Bank of Canada, may cut rates next month. The Swedish krona is the weakest of the G10 currencies today, off by about 0.45%,...

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Market Pushes the Yen Lower, Helped by a Broadly Firmer Greenback

2024-05-07

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2024-05-07

Overview: The dollar is firmer against all the G10 currencies today. The market is somewhat less fearful of intervention and the yen is extending yesterday's losses. It is rivaling the Australian dollar for the weakest of the major currencies after the Reserve Bank of Australia left rates on hold and played down speculation of possibility of a rate hike. Both currencies are off around 0.4% in late European morning turnover. Disappointing German...

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Yen Slips, Yuan Jumps, Dollar is Mostly Softer

2024-05-06

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2024-05-06

Overview: The dollar is mostly a little softer today in thin market conditions, with Tokyo, Seoul, and London closed for holidays. The Japanese yen is the weakest G10 currency, losing about 0.5% and slipping through last Friday's lows. At first, after Fed Chair Powell did not endorse rate hike speculation, the market thought he was dovish. But after the softer than expected jobs data and weakness in the ISM services, the market shifted from...

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Corrective Forces Help the Dollar Stabilize

2023-11-22

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2023-11-22

Overview: Corrective forces helped the dollar stabilize yesterday and it enjoys a firmer today. The euro has slipped below $1.09, and the dollar has resurfaced above JPY149.00. The FOMC minutes seem dated by the more than 30 bp decline in the US 10-year yield, the 7% rally in the S&P 500 and roughly 3% drop in the Dollar Index. The implied year-end 2024 Fed funds rate has fallen by 10 bp to 4.51% (5.33% currently). The Japanese government...

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Higher for Longer Lifts the Dollar, while SNB Surprises Many by Standing Pat–Over to the BOE

2023-09-21

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2023-09-21

Overview: The Federal Reserve's hawkish hold, which included 50 bp less of cuts next year than it had signaled in June, has lifted the dollar against most currencies today. The notable exception is the Japanese yen. The greenback did extend its advance to new highs for the year before the market turned cautious ahead of the outcome of the Bank of Japan meeting tomorrow. The Swiss franc is the weakest of the G10 currencies after the Swiss National...

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Week Ahead: Thumbnail Sketch of Central Bank Meetings

2023-09-16

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2023-09-16

The week ahead is dominated by central bank meetings. Six of the G10 central banks meets. The post-Covid monetary tightening cycle is ending. The start was not synchronized, and neither will be end. It is tempting to think that those that began the tightening cycle early will among the first to finish. Among emerging markets that is true for Brazil and Chile, both of whom have begun cutting rates. And Brazil is likely to deliver the second cut in...

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PBOC Sends Signal in Lower Dollar Fix, while the Canadian Dollar makes a 9-Month High

2023-06-27

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2023-06-27

Overview: Hawkish comments by ECB President Lagarde at the central bank symposium in Sintra and the PBOC's weaker dollar fix have weighed on the greenback today. It is lower against most of the G10 currencies, but the Japanese yen and Norwegian krone. It also slipped to a new nine-month low against the Canadian dollar. Emerging market currencies are also mostly firmer, with the notable exceptions of the Russian rouble and beleaguered Turkish lira....

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The Greenback Firms to Start the New Week, Stocks Slide

2022-09-19

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2022-09-19

Overview:  The busy week is off to a slow start as Japan is on holiday and the UK and Canadian markets are closed to honor Queen (Australia will commemorate with a holiday on Thursday). Nevertheless, the sell-off in equities continues and the US dollar is firm. Most of the large markets in Asia fell. India is a notable exception. Its benchmark rose for the first time in four sessions, helped by bank shares and Infosys. Europe’s Stoxx 600 is off for...

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Stocks Hit as Central Banks Brandish Anti-Inflation Efforts

2022-06-30

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2022-06-30

Overview: Central banks are committed to combatting inflation even as the economies weaken. This is taking a toll on investor sentiment and is dragging down equities.

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