Economic Conditions

The US dollar and the yen are trading heavy, while risk assets, including emerging markets, and the Turkish lira, have jumped.  Sterling is the strongest of the majors.  It is up about 0.5% (~$1.6365), helped by the opportunity of GBP23.4...

Four large dramas being played out among the major high income countries. The drama in the Eurozone moves center stage in the days ahead, with an important European Court of Justice ruling due and the ECB meeting. Four large dramas...

The two main developments in the foreign exchange market this week in recent days has been the opposite of what has transpired over the past several weeks.  Sterling moved higher quickly.  The yen moved down just as fast.  Over the...

Sterling is leading the new appetite for risk as one element of political uncertainty has been lifted.  It is moving higher for the third consecutive session today; advancing by more than 1.5 cents to reach $1.3180. It staged an impressive...

The combination of the rebounding US job growth and gains in the S&P 500 to near record levels before the weekend is helping boost the US dollar against the major currencies, while the emerging market currencies are mixed.  In addition,...

Investors are under siege.  A growing proportion of bonds in Europe and Japan offer negative yields.  The German and Japanese curves are negative out 15-years, while one cannot find a positive yield among any tenor of Swiss government bonds.  Despite...

The US dollar had a good week.  It was helped by the strongest service ISM this year, with strong gains in forward-looking new orders component and an increase in export orders. Non-farm payrolls snapped back from a downwardly revised 11k...

The conventional narrative has it backward.  It worries about the threats to stability emanating from the periphery in Europe.  Policymakers, investors, and economists still refer to the "Greek, Irish, Portugal and Cyprus' bailouts.  The biggest threats do not come from...

What a difference a few days make.  Many saw last week's equity market advance a sign that Brexit anxiety was overdone.  However, quarter-end position adjustments appear to have been misread.  Equity markets are falling now. Bond yields in the US,...

Monday, while Americans were celebrating the original Brexit, the US dollar drifted lower.  The Australian dollar fully recovered from electoral uncertainty drop to finish about 0.5% higher.  Asian and emerging market equities rallied, but Europe faltered.  The MSCI Asia-Pacific Index...

There have been two developments that are shaping investment climate.  The first was the dramatic rally in equity markets last week, with many recovering nearly all that was lost on the Brexit wobble.  The second was clear indications that the...

The US dollar turned in a mixed performance in the week after the UK decision to leave the EU.  There was an acute market reaction for a couple of days, but the disruption to the financial system was not major....

The US dollar is little changed ahead of what will likely be a thin North American session due to the US holiday on Monday.   The Australian and New Zealand dollars are attracting flows, ostensibly as a place to park funds,...

After plummeting 18.6 cents, mostly in a few hours after it became clear that the Brexit would carry the day, sterling has rallied four cents from the low set on Monday.  We recognized that the magnitude of the drop left...

No fundamental development can compare with the UK decision to leave the EU. It has set off a chain reaction whose outcome is still far from clear.  Sterling is firm, alongside most of the major and emerging market currencies today. ...