Risk Off

Market movers today A key focus today will be the August flash PMIs out in most western countries. In Europe, further declines – as also signalled by ZEW – will probably be in store, as the energy crisis is taking its toll on demand in manufacturing and services, and recession fears are rising. In the […]

The Unstoppable Dollar Rally

Monday blues kicked in following a $7 trillion rally since July, which was mainly fueled by the expectation that the recession rhetoric would convince the Federal Reserve (Fed) to stop raising the rates and even start thinking about cutting the rates. Now that the Jackson Hole meeting approaches, those bets are vanishing, as there is […]

EUR/USD Set a New Sell-off Low this Morning Around 0.9920

Markets The new surge in European gas prices extended the core bond sell-off yesterday. They worsen the inflation outlook with central banks not blinking to increased recession risks and favoring frontloading policy normalization/tightening in their inflation crusade. The Dutch benchmark future (TTF) moved above the March peak (early stages Russian war in Ukraine). European bonds […]

Markets Whacked by Hawkish Fed Worries

Asian shares were painted red on Tuesday, tracking a heavy sell-off on Wall Street overnight as concerns over upcoming aggressive Fed hikes sapped risk sentiment. European shares took a beating in the previous session amid fears around the region’s energy crisis. Stocks are expected to open lower again this morning thanks to the negative sentiment […]

Euro Drops to New 20-Year Low

EUR/USD has stabilized after a rough start to the week. In the European session, EUR/USD is trading at 0.9931, down 0.10% on the day and its lowest level since November 2002. After weeks in retreat, the US dollar has rebounded and is showing broad strength. The euro has taken it on the chin, falling 2.12% […]

Pound Recovers Losses after Jobs Report

The British pound remains under pressure. In the North American session, GBP/USD is trading at 1.2055, unchanged the day. The pound fell as low as 1.2007 in the Asian session, just above the symbolic 1.20 line. UK wage growth remains high The economic outlook in the UK is grim and today’s employment report didn’t bring […]

Sunset Market Commentary

Markets: Core bonds started slipping going into the US session following a rather dull European encounter. There is no clear driver, though earnings by Wall Mart and by Home Depot offered a sigh of relief to investors. Earnings topped (lowered) estimates with retailers showing more resilience than feared. The results at least temporary put aside […]

Canadian Inflation Loses a Bit of Steam in July

Consumer price inflation lost a bit of steam in July, but was still high – up 7.6% year-on-year (y/y). It was a step in the right direction though, losing a bit of steam from an 8.1% y/y pace in June. Lower gasoline prices held down inflation in July, with prices falling 9.2% on the month […]

Refreshed US Dollar Awaits Fed Minutes and Retail Sales

The US dollar rally has picked up a second wind, despite some signs that the US economy is losing steam. Investors seem much more concerned about Europe and China, which is helping the reserve currency attract safe-haven flows. Retail sales data and the minutes of the latest Fed meeting will hit the markets on Wednesday, […]

First Impressions: RBNZ Monetary Policy Statement August 2022

Another 50 basis point hike in the OCR to 3%, with the Reserve Bank firmly focused on inflation developments. RBNZ Monetary Policy Statement, August 2022 • The Reserve Bank has increased the Official Cash Rate by another 50 basis points to 3%. The size of the move was universally expected by economists and financial markets. […]