Change in Bank of Canada stance implies higher USD/CAD There have been a lot of central bank meeting recently. None of them made any changes in their official rates but a few of them — the Bank of Canada (BoC), the Reserve Bank of New Zealand and Norges bank in particular – have changed the [...]
March 1, 2013
Market Insights – 1st March 2013
In our last Viewpoint, I wrote somewhat about the election in Italy and why it was such a big deal for the Eurozone. I think it’s such a big deal that I’m going to write about it some more. The main reason it’s such a big deal is that it raises the possibility of Italy [...]
February 28, 2013
Daily Market Update – 28th February 2013
Stocks up, dollar down in risk-on trade • More soothing words from Fed Chairman Bernanke and a better-than-expected US durable goods orders figure sent stocks sharply higher overnight in the US, with the Dow Jones average recovering all of Monday’s loss and more to close at near the record high and the VIX index falling [...]
February 27, 2013
Daily Market Update – 27th February 2013
• Markets regained their poise after US Fed Chairman Bernanke came out with some encouraging words. Although European stocks closed lower across the board, US stocks finished higher and US bond prices ended down a bit. But many of the other “risk on” trades, such as USD/JPY, failed to perform, and gold ended higher, indicating [...]
February 27, 2013
Market Insights – 27th February 2013
The Euro is in serious trouble. Not so long ago, ECB president Draghi was talking about “positive contagion” spreading from one country to another as the situation in the peripheral countries seemed to improve. But it turns out that only the financial indicators were improving. The real economy in these countries continued to do poorly. [...]
February 26, 2013
Daily Market Update – 26th February 2013
• All of a sudden, the markets remember risk. After the Italian vote resulted in a hung parliament, stock markets around the world fell sharply, the VIX index soared 34%,Treasuries and gold rallied on safe-haven flows, and even the yen came back in fashion. • The anti-establishment result of the Italian election was clear from [...]
February 25, 2013
Daily Market Update – 25th February 2013
• We’re in for quite a week this week. First there was Moody’s downgrade to Britain on Friday, which has sent sterling reeling (see GBP/USD section). Then there was the Italian election on Sunday. The election doesn’t finish until 3 PM in Rome today, so we won’t know the winner until later today, but the [...]
February 22, 2013
Market Insights – 22nd February 2013
There’s a lot of talk nowadays about “currency wars.” This is a reference to the fight among countries to weaken their currency, or at least to keep their currencies from appreciating. The question of currency wars and FX market intervention was a big deal at the recent G20 meeting, particularly with regards to Japan. There, [...]
February 22, 2013
Daily Market Update – 22nd February 2013
• The theme yesterday was euro weakness following worse-than-expected purchasing managers’ indices (PMIs) from the Eurozone. France was especially weak, with the gap between France and Germany’s PMI hitting the widest ever. Added to increased concerns about this weekend’s election in Italy, the euro lost ground against most currencies. • Commodity currencies initially weakened, then [...]
February 21, 2013
Daily Market Update – 21st February 2013
• Currency wars indeed! Yesterday’s actions demonstrate perfectly what the G7 and G20 were trying to explain: that monetary policy aimed squarely at domestic conditions can have dramatic effects on the exchange rate as an unavoidable side effect. First the minutes of the Bank of England Monetary Policy Committee (MPC) meeting showed that three of [...]
March 19, 2013
1 Comment