Tag Archive: #USD

FX Weekly Preview: Politics and Economics in the Week Ahead

2017-04-24

by

2017-04-24

Provided Le Pen and Macron or Fillion make to the second round, the market response to the French election results may be short lived. BOJ, Riksbank and ECB meetings. Spending authorization and some announcement from the White House on tax policy are in focus as Trump's 100th day in office approaches.

Read More »

State of Dollar Bull Market

2017-04-22

by

2017-04-22

The dollar market is intact, despite the pullback here at the start of 2017. We have seen similar pullbacks in 2016 and 2015. Divergence remains the key driver.

Read More »

FX Daily, April 20: Dollar and Yen Push Lower

2017-04-20

by

2017-04-20

With the exception of the yen, the US dollar is lower against all the major currencies. US Treasury yields are firm, extending yesterday's rise a little. This may help keep the dollar straddling JPY109, but unwinding long yen cross positions is helping underpin the other major currencies. The Dollar Index is making a new low for the week and appears poised to test support around 98.85-99..00.

Read More »

More Thinking about Trade as Pence and Ross Head to Tokyo

2017-04-19

by

2017-04-19

Pence and Ross may "feel out" Abe for interest in a bilateral trade agreement. The US enjoys a small trade surplus with countries it has free-trade agreements. Ownership-based framework of the current account and value-added trade suggest the US trade imbalance is not a significant problem.

Read More »

FX Daily, April 18: US Dollar Consolidates Yesterday’s Gains

2017-04-18

by

2017-04-18

The US dollar is consolidating the gains scored late in the US session yesterday in response to a Financial Times interview with US Treasury Secretary Munchin who seemed to play down the strategic importance of Trump's recent complaint about the greenback's strength.

Read More »

FX Daily, April 17: Markets Trying to Stabilize in Holiday-Thin Activity

2017-04-17

by

2017-04-17

Financial centers in Europe are closed for the extended Easter holiday. Australian and New Zealand markets were also closed. The drop in US 10-year Treasury yields in early Asia, with a brief push below 2.20%, appears to have kept the dollar under pressure. As the North American market prepares to open, the dollar is softer against the all major currencies and many emerging market currencies.

Read More »

Monetary Policy is Important, but US Fiscal Stance Moving Center Stage

2017-04-17

by

2017-04-17

Monetary policy is off the table for at least the next two months. Several fiscal issues are coming to a head. Despite the GOP majority in Congress and White House, brinkmanship cannot be ruled out.

Read More »

FX Weekly Preview: What to Watch in the Week Ahead

2017-04-17

by

2017-04-17

Many observers misunderstood US President Trump's "American First" rhetoric. Trump's earlier writings show that this is not a reference to the 1940s effort to keep the US out of WWII, with its isolationist tint. Rather, Trump's use goes back to the original use by President Harding in the 1920s. It was a rejection of the Wilsonian multilateralism (e.g. League of Nations) and a robust defense of unilateralism.

Read More »

Euro’s Record Losing Streak Against the Yen

2017-04-15

by

2017-04-15

Euro/Yen
The euro has fallen for 11 consecutive sessions against the yen. Interest rates, US and German in particular, seem to be the main driver. Technicals are stretched, but have not signaled a reversal yet.

Read More »

FX Daily, April 14: Holiday Markets Remain on Edge

2017-04-14

by

2017-04-14

The holiday-induced calm in the capital markets conceals a high degree of anxiety. The investment climate has been challenged by heightened geopolitical risk and unusual complaints about the US dollar's strength from the sitting US President. While sending an "armada" toward the Korean peninsula, the US ordered a missile strike against Syria in retaliation for the use of chemical weapons and dropped the largest bomb in the world on Afghanistan.

Read More »

FX Daily, April 13: Greenback Stabilizes After Trump Induced Slide

2017-04-13

by

2017-04-13

The US dollar slid after US President Trump complained about its strength. The sell-off extended into early Asian activity, before stabilizing. It is mixed in late morning European turnover, which is already lightening up due to the extended Easter holiday.

Read More »

FX Daily, April 12: Investors Catch Breath, Markets Stabilize

2017-04-12

by

2017-04-12

Markets are calmer today. The significant movers yesterday have stabilized. The dollar has been unable to resurface above JPY110, but after plumbing to new lows near JPY109.35 in Asia, the dollar has recovered back levels since in North America late yesterday. The decline in the US 10-year yield was also initially extended in Asia before stabilizing and returning to levels seen in the US afternoon.

Read More »

FOMC Minutes Suggest Balance Sheet May Begin Shrinking This Year

2017-04-12

by

2017-04-12

FOMC minutes increased likelihood that Fed will begin reducing its balance sheet late this year. There does not seem to be a consensus on other issues. The strength of the ADP report contrasts with softness seen in the ISM and PMI non-manufacturing surveys.

Read More »

FX Daily, April 11: Dollar Pushed Lower in Subdued Activity

2017-04-11

by

2017-04-11

The US dollar has a slight downside bias today through the European morning. The market does not seem particularly focused on high frequency data, though sterling traded higher after an unchanged year-over-year reading of 2.3%, and the euro traded higher after a stronger Germany ZEW survey.

Read More »

Impressive Japanese Flows at the end of the Fiscal Year

2017-04-11

by

2017-04-11

Japanese investors bought foreign bonds in the last week of March for the first time in nine weeks. Foreigners bought the most Japanese stocks since last April. The pain trade is for a break of JPY110.

Read More »

FX Weekly Preview: A New Phase Begins

2017-04-10

by

2017-04-10

There were no celebrations; no horn or trumpets, nary a sound, but an important shift took place last week. The shift was signaled by two events. The first was the US strike on Syria, and the second was investors' willingness to look past Q1 economic data.

Read More »

US Jobs Growth Disappoints

2017-04-08

by

2017-04-08

The US jobs growth slowed considerably more than expected in March and the disappointment pushed the dollar and equities initially lower. The US created 98k jobs in March, well below market expectations for around 175k jobs.  Adding insult to injury, revisions to the January and February data took off another 38k job.

Read More »

Short Note on US Employment Report

2017-04-07

by

2017-04-07

The US jobs data is notoriously difficult to accurately forecast consistently.  I do not claim to do so now.  My intent is more modest.  It is simply to point out why I there is risk that the jobs data is disappointing, especially after the stronger than expected ADP estimate. 

Read More »