Week Ahead – Spotlight Turns to Pound and Non-US Data after Dollar Bruising

After another US inflation surprise, CPI data will be dominating the agenda in most other markets in the coming week, shifting the focus away somewhat from the greenback. The pound will likely attract the most attention in what will be a busy week for the United Kingdom, as apart from the economic releases, the budget […]

Is the Japanese Yen Setting Up for a Trend Reversal?

Interest rate differentials have crushed the Japanese yen. The currency is down 18% against the US dollar this year, sinking to its lowest levels in three decades. However, there is light at the end of the tunnel. With the Bank of Japan opening the door for tighter policy and the government rolling out new spending […]

Research US

While markets have reacted very positively to the October CPI print, we continue to see further risks of more persistent inflation and think it is too early to trade a clear Fed pivot. Still elevated underlying price growth, tight labour markets, inflationary market reaction and China reopening risks all favour remaining cautious on inflation. The […]

Week Ahead – Moment of Truth

US After a round of soft inflation data triggered a buy-everything relief rally, Wall Street will focus on Fed speak and a plethora of data points that might show the economy remains resilient.  The key economic readings include manufacturing activity, retail sales, and housing data. There will be no shortage of appearances by the Fed […]

Pound Traders Turn Gaze to UK Inflation Data and Budget Announcement

Despite the UK economy contracting by less than expected in Q3, investors continued to scale back their BoE rate-hike bets. However, they may have to reexamine those bets next week, as the economic agenda includes the employment report for September on Tuesday at 07:00 GMT, the inflation numbers for October on Wednesday at the same […]

Xi and Biden to Meet Today

Market movers today Ahead of the G20 leaders’ summit tomorrow, President Xi and Biden are set to meet for their first face-to face meeting today. Securing ‘guardrails’ on the Taiwan issue could be the most important topic, while we also look out for comments from Xi about his opposition to using nuclear weapons. Fed’s Brainard […]

All I Want for Xmas is Lower Inflation, and Softer ChinesePolicies

It has been an ugly weekend for cryptocurrencies, even though the selloff remained relatively contained in the sector giants like Bitcoin, compared to the size of the bad news that flew in last Friday. On Friday, FTX filed for Chapter 11. Even FTX’s US leg – that many hoped could come unharmed went under. The […]

Post-CPI Market Reaction Calls an End to Very Strong Market Trends

Markets Last Thursday’s US October CPI release still dominates the debates. The relative small downward surprise (headline 0.4% M/M & 7.7% Y/Y; core 0.3% M/M & 6.3% Y/Y) triggered an outsized market reaction. They flipped odds for the outcome of the December Fed policy meeting completely towards 50 bps where FOMC Chair Powell after the […]

A Choppy Start

It’s been quite a choppy start to the trading week, with much of the focus on China where Covid relaxation measures and property market support have brought some relief. Unfortunately, both come at a time of record Covid infections in major cities including Beijing and Guangzhou. And those relaxation measures that were announced are not […]

USD/JPY Claws Back

After a huge rally last week, the Japanese yen has reversed directions today. USD/JPY is trading at 140.21, up 0.99%. On the economic calendar, Japan releases GDP for the third quarter. There are no economic events in the US today. A week to remember The US dollar dropped like a stone last week, courtesy of […]