Category: Other Forex Stuff
The unbearable lightness of being
Europe is still stumbling through a sovereign debt crisis, Greece is close to default, Portugal is in dire need of more cash yet, risk appetite so far this year has been a minor revelation. Some major equity markets such as the DAX and the Hang Seng are up more than 10%; BRIC equities are also
Bernanke hints at QE to come (Video)
In a surprisingly (but also refreshingly) candid admission, Fed Chairman Bernanke declared last night that another round of quantitative easing may well be necessary to alleviate “high and persistent unemployment in an underperforming economy”. With inflation still low and Europe a potential drag on the economy, the Fed Chairman clearly feels that more asset purchases
The perils of misplaced optimism
Markets have taken some comfort from the better-than-expected run of data seen in the early part of the year, the most recent being yesterday’s provisional PMI data in Europe. But are we heading for a repeat of the last two years? Both data sets saw a strong tendency for upside surprises in the early part,
The euro gets carried away
Has the euro become the new carry currency of choice? That’s the suggestion being thrown around on the back of the performance seen so far this year, together with the injection of 3-yr funds last month and the talk of anything up to EUR 1trln or more at the next 3-yr tender in February. We
A full day’s work ahead of euro FinMins
Today’s meeting of eurozone finance ministers in Brussels has a very full agenda to consider. There is the latest draft of the fiscal compact to discuss (see below), a review of the progress made in the Greek debt talks, and a conversation on a draft for the European Stability Mechanism (ESM). The latter apparently includes
Euro punching above its weight
We’ve highlighted before the euro’s vulnerability to pushing higher as short positions are squeezed out and this was partly in evidence yesterday as the single currency moved back above the 1.28 level on a combination of better risk appetite and decent results from the latest round of debt auctions in the eurozone. It was notable
More easing in the emerging markets
No great surprise to see Brazil cutting rates by 50bp overnight (taking key rates to 10.5%), given that the latest GDP figures show the economy having ground to a halt in the third quarter of last year. This should also be seen in the context of the more fragile global environment. The Brazilian real has
Markets eye Q1 Greek default
There are mixed reports as to the fate of the deal with private sector creditors of Greece. Bloomberg reports that negotiators are near to a deal, equivalent to 32 cents per euro. In contrast, there are reports in the UK press (The Independent) that some investors are still blocking a deal in order to negotiate
China coming off the pace
The pace of GDP growth in China slowed to the softest rate for ten quarters overnight, although at 8.9%, the economy has hardly ground to a halt. Furthermore, the growth was a touch firmer than expected (market was looking for 8.7%), but as Chinese statistics go, this difference is insignificant. Nevertheless, what China needs to
More clouds over Europe
Following S&P’s announcement late on Friday night that it was downgrading the credit rating of nine eurozone countries, Europe’s leaders are once again on heightened alert as the sovereign debt crisis threatens to deteriorate. For just for a short while there seemed to be something of a reprieve for Europe, with the fiscal compact starting