Aussie Extends Slide

The Australian dollar has posted losses over three straight days and is sharply lower on Monday. In the North American session, AUD/USD is trading at 0.6610, down 0.96%. RBA shifts gears The Reserve Bank of Australia has changed course and eased up the pace of hikes, but with inflation still accelerating, is it too soon? […]

Will Fed Minutes Shed Light on Rates' Coming Path?

Despite the latest efforts by several Fed officials to douse market speculation with regards to an imminent pivot, investors are still pricing in almost two quarter-point rate cuts by the end of 2023. With that in mind, they may dig into the minutes of the latest FOMC gathering for clues as to what policymakers discussed […]

Sunset Market Commentary

Markets Markets started the week with a Chinese inspired, admittedly modest, risk-off. The reaction of authorities to a new wave of Covid infections raised questions on an easing in the country’s zero-Covid policy. The change in sentiment on Chinese markets also illustrates that good news which, together with lower interest rates, supported the recent risk […]

Biggest Ever RBNZ Hike in the Pipeline

Market movers today A quiet day in terms of economic data, euro area November flash consumer confidence will be released in the afternoon. Consensus expects the National Bank of Hungary to maintain its policy rates unchanged at the monetary policy meeting today. Overnight, we expect the Reserve Bank of New Zealand (RBNZ) to hike its […]

Market Sentiment Fragile on Uncertainty Regarding Whether China Would Make a U-turn

Market sentiment is fragile on uncertainty regarding whether China would make a U-turn on its Covid reopening plans. The widening spread between the US 2- and 10-year yields, which hit the widest inversion since the middle of 80s, and between the US 3-month and the 10-year yields warn that recession will be inevitable. In the […]

RBA Board Takes a Dovish Tilt

The RBA softens rate outlook just when it is increasing its inflation forecast – unusual approach. The Minutes of the November Monetary Policy Meeting make a clear case for adopting a steady approach to the policy process. The key section of the Minutes contains a new dimension to the discussion on policy. The advantage of […]

Putting the Church in the Middle of the Village

Equities saw some profit taking in last week’s post-US inflation rally, as some Federal Reserve (Fed) officials put ‘the church in the middle of the village’ as would say Swiss, reminding investors that the 7.7% inflation is still high and that the Fed would continue fighting to bring it lower. The S&P500 couldn’t extend gains […]

Tensions Between US and China Show Signs of Easing

Market movers today The G20 leaders’ summit is kicking off in Bali and markets will be attuned to any geopolitical headlines. In the euro area, German ZEW expectations for November are on the agenda and it will be interesting to see whether the October uptick extends for another month amid easing energy crisis fears. ECB’s […]

Weakening of Yen for Now Apparently Isn't a Support for Japanese Economy

Markets Yesterday was the first day of what we fear will be a November lull. The sharp repositioning after last Thursday’s US CPI release, the arrival of technical support/resistance levels, the absence of key eco data and central bank gatherings and reduced trading volumes in next week’s shortened Thanksgiving week set the stage for short […]

BoE Facing Tough Decisions

Equity markets are looking slightly positive in early trade on Tuesday, adding to modest gains at the start of the week. While the rally is perhaps slowing a little after the strong gains of recent weeks, there doesn’t appear to be much appetite at this stage to bail on it. Perhaps the experience of the […]