Tag Archive: #USD

FX Daily, March 19: Third Vote on Withdrawal Bill Scuppered Until after EU Summit

Overview:  The capital markets remain subdued.  Many Asian equity markets eased after a strong two-day advance.  European equities are slightly firmer.  The S&P 500 closed at new five-month highs yesterday.  Benchmark 10-year yields are mostly a little softer.  Australian 10-year bond yield fell five basis points, and the discount to the US widened to a new high since the early 1980s. 

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FX Daily, March 18: Equities Advance, Dollar Slips, Key Events Awaited

The eventful week has begun off slowly. After Wall Street's best week in four months underpinned Asian' equities, where all the markets but Thailand, advanced, led by the nearly 2.5% rally in Shanghai. Note that New Zealand's S&P/NZX 50 rose to new record highs.

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FX Weekly Preview: Three Highlights in the Week Ahead

Three events next week will shape the investment climate. The Federal Reserve meets and will update its forecasts and guidance. The British House of Commons may vote for a third time on the Withdrawal Bill before Prime Minister May heads of the EU Summit to ask for an extension of the UK leaving the EU. The eurozone sees the flash March PMI, with great hope that the green shoots of spring will be evident.

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FX Daily, March 15: Euro and Yen Volatility Slips to New Five-Year Lows on the Ides of March

Overview: The capital markets are calm ahead of the weekend.  Outside of Australia and Thailand, Asia Pacific equities advanced, while European shares are mostly little changed. The regional benchmarks, like the S&P 500 have recouped last week's losses.  Benchmark 10-year yields are little changed on the day, leaving the US 10-year yield virtually unchanged on the week near 2.62%.

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FX Daily, March 14: Another UK Vote, but No Closure

Overview:  The Brexit drama continues to play out, and the Withdrawal Bill that has been twice defeated is ironically not dead yet. Today's vote, in fact, is predicated on another "meaningful vote" before seeking an extension.  Sterling remains firm near yesterday's highs, which were the best levels since last June.

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FX Daily, March 13: Still Waiting for Brexit Climax

The Brexit drama continues to command attention. A vote on leaving without an agreement will be held today, and if that fails, there will be a vote tomorrow on an extension. Meanwhile, the first increase in headline US CPI in four months failed to impress as the year-over-year pace fell to 18-month lows.

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FX Daily, March 11: Greenback Starts New Week Decidedly Mixed, with Brexit Anxiety Weighing on Sterling

Overview:  Asian shares recovered from opening losses to finish mostly higher, with the Shanghai Composite up nearly 2% and India tacking on 1% after the election was called, starting April 11.  European markets, led by energy, communication, and materials sectors, is up about 0.5% through midday. The S&P 500, which closed lower every day last week is looking a little firmer. 

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FX Weekly Preview: Brexit Comes to a Head, and while Europe and US Data Rebound, the Equity Rally Falters

Brexit comes to a head. By nearly all reckoning, the Withdrawal Bill will be resoundingly defeated in the House of Commons on March 12. The margin of defeat may not match the first rejection, but it will be the death knell to the path that had been negotiated for a year and a half.

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FX Daily, March 08: Equities Slump on Growth Concerns ahead of US Jobs

Overview: A weak economic assessment in the Beige Book and an ECB that slashed growth forecasts have been followed by news of a nearly 21% slump in China's exports have marked the end of the dramatic equity rally that was seen in the first part of 2019 after the sharp losses late last year. 

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FX Daily, March 07: EMU Looks to ECB

The ECB meeting is today's highlight. A dovish signal is expected. The euro remains pinned near its lows ahead it. The global equity market rally in January and February is faltering this week. Asian equities were mixed, but the Nikkei eased for the third consecutive session.

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FX Daily, March 6: The Dollar Index Extends Gains into the Sixth Consecutive Session

Overview:  The capital markets are on edge.  The week's big events lie ahead.  The Bank of Canada meets today and the ECB tomorrow, followed by US (and Canada) employment data on Friday.  The equity markets are mixed.  While Japan and Korean equities eased, China's markets continue their tear. 

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Thoughts about the ECB and Euro

Mario Draghi's term at the helm of the ECB is winding down. He will step down in October. It has not been an easy job. The light at the end of the tunnel in 2017 turned out to be another train in 2018. The eurozone enjoyed 0.7% quarterly growth every quarter in 2017. The ECB was able to outline an exit from its asset purchases. The debate began over sequencing and when the first rate hike could be delivered.

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FX Daily, March 05: Dollar Remains Firms as China Cuts Growth Target and Taxes, while EMU PMI Surprises on Upside

Overview:  It is an eventful day, but the capital markets are taking it in stride.  Equity markets are mixed.  Asia may have been weighed down by China's shaving its growth target and announced around CNY2 trillion (~$300 bln) in tax cuts to support the economy, though Chinese stocks edged higher. 

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FX Weekly Preview: Dovish Hold by the ECB and Uptick in US Wages will Underscore Divergence

The important events take place in the second half of the week ahead: the ECB meeting and the US employment report. A dovish hold by the ECB is the most likely outcome. US jobs growth is bound to slow from the heady 304k gain in January, but there won't be anything in it that lends credence to ideas that the world's largest economy is on the precipice of a recession.

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FX Daily, March 01: Could the Worst be Behind China and Germany? Or Hope Springs Eternal

Overview:  News that MSCI plans to substantially boost China's equity weighting in its indices and a better than expected Caixin manufacturing PMI and some easing of India-Pakistan tensions helped bolster the risk-taking appetite going into the weekend.  This lifting equity and weighing on bonds.  China's CSI 300 rose 2.2% for a 6.5% weekly gain. 

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FX Daily, February 27: Dollar Trades Heavily, While Prospects of a Softer and Later Brexit Send Sterling Higher

Overview: As the North American session is about to begin, the markets await developments in the UK House of Commons where a vote is expected today on Prime Minister May's proposal to hold votes on around March 12 on the Withdrawal Bill and no deal. However, perceptions of a reduced likelihood of a no-deal exit continued to fuel sterling gains.

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FX Daily, February 26: Brexit Dilution Lifts Sterling, while Yesterday’s Equity Rally Fades, Powell Awaited

Overview:  The increased likelihood that Brexit is delayed and the possibility of a second referendum is helping lift sterling.  As has been the case for most of the time since the June 2016 referendum, the prospects of a softer and/or later Brexit is understood as sterling positive.  The other key focus is US-Chinese trade. 

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FX Daily, February 25: Dollar Thumped on Confirmation of Tariff Delay while Stocks Advance

Overview: The extension of the US-China tariff freeze had been telegraphed, but the confirmation is the single biggest driver of the day. Equities, led by a 5%+ advance in China, have rallied in Asia and Europe. Benchmark 10-year bond yields are mostly 1-2 basis points higher.  Peripheral yields are lower.

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FX Weekly Preview: The Week Ahead

After a dismal end of 2018, investors are faring better through the first two- thirds of the Q1 19. Equity markets have recouped a good part of the late-2018 decline. Bond yields, however, have not returned to where they previously were. The tightening of financial conditions, which was both cause and effect of heightened anxiety among investors, and spooked some central bank have eased considerably.

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FX Daily, February 20: US-China Trade and Brexit Dominate Ahead of FOMC Minutes

Overview:  The US dollar is narrowly mixed against the major currencies, but the strongest currency today is the Chinese yuan, following reports that US wants China to keep the yuan stable and not offset US tariffs with currency depreciation.  The second monthly decline in Japanese exports weighted on the yen.  In the UK, another Labour MP left, while there is speculation that a few Conservatives may defect today. 

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