Dollar Mixed while Stocks Slide to Begin Last Week of Q3

Dollar Mixed while Stocks Slide to Begin Last Week of Q3

The US dollar is narrowly mixed.  The euro, yen and Swiss franc are higher, while the dollar-bloc and sterling are softer.  The moving element here is not so much the greenback, which serving more as a fulcrum, but idiosyncratic, country-level developments. The yen is the strongest of the majors. The dollar was turned back from above JPY101 and is now […]

Europe’s Third Challenge

Europe’s Third Challenge

ECB President Draghi made clear at yesterday’s press conference that new risks have materialized and the central bank’s job to reaching its mandate is far from over. Current efforts may not suffice to achieve its legal prescribed mandate. Monetary policy will be reviews and reassessed at the next meeting in March, when new staff forecasts […]

Fishing for a Bottom to Dollar-Yen

Fishing for a Bottom to Dollar-Yen

photo: faungg Since the initial spike higher when the BOJ provided some operational tweaks to its asset purchase program on December 18, the dollar has fallen 5.6% against the yen through Tuesday’s low near JPY116.70.  We had warned that the break of JPY120 would spur a move to JPY118, and the move below JPY118 targeted the August low near JPY116.20. While […]

Don’t Believe Your Lying Eyes

Don’t Believe Your Lying Eyes

Chinese equities continued their precipitous decline, interrupted by the new circuit breakers, which reportedly will be suspended. Global equity markets are also in a dramatic decline. However, do not be misled. Knowing the direction of China’s blue chips (CSI 300) does not really help predict the direction of the US equity market, even though it […]

We Have Lift-Off

We Have Lift-Off

The Federal Reserve delivered a hawkish hike. The dot plot reflects expectations for four rate hikes in 2016. There were no dissents. This is important. It underscores the decisiveness of the decision. There have been three voting Fed members that were thought to be likely dissents. The Fed will also continue to reinvest maturing securities […]

Jobs Data Keeps Fed on Track to Hike

Jobs Data Keeps Fed on Track to Hike

After the ECB’s disappointment yesterday market nerves were shattered, but the largely as expected US jobs data may help the focus return to the underlying fundamental fact. The ECB just eased policy. Not as much as the market expected, and that speaks to market positioning, but it did ease. And the 211k increase in November […]

Greenback Flexes Muscles

The prospect of the Fed rate hike next month while many other countries consider providing more stimulus continues to underpin the dollar. Corrective downticks remain shallow and brief. The euro slumps to near seven month lows just below $1.0645. The greenback posted a big outside up day against the yen yesterday, and follow through buying […]

Germany: It Ain’t Your Father’s Locomotive

This Great Graphic comes from Markit’s Chris Williamson.   It illustrates that the German good producing sector has fallen on hard times again.  The economy contracted by 0.2% in Q2.  Another decline in Q3 cannot be entirely ruled out, though it may just escape with something just above stagnation. The main cause that most politicians and economists will focus on […]

Corruption Scandal Makes the Brazilian Elections Even More Exciting

(from my colleague Ilan Solot)  The political outlook for the Brazilian elections is being rocked by leaked information about the corruption scandal surrounding Petrobras’ former director Paulo Roberto Costa – affectionately known as the “suicide bomber.” The man-bomb has agreed to a plea bargain (i.e. providing information in exchange for a reduced sentence) and has […]

FAQ: Scottish Referendum

What is the Scottish Referendum?  Scotland has been a part of the UK for over 300 years.  Last year, Scotland reached an agreement with the UK to hold a referendum on Scottish independence.  The Scotland National Party has an outright majority in the Scottish parliament and a referendum has been a longstanding pledge. When will the […]

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