Author: Joel Wright
Joel has been involved in the markets for the past 10 years. During that time he’s worked in market analysis teams in London, in the financial technology sector in Singapore – working mostly with automated trading tools and algorithms – and most recently he’s been planning FX risk hedging for an SME in Bangkok. Joel has a first-class honours degree in Financial Services and currently writes about foreign exchange for several global businesses.
You can get in touch with Joel via email here or via the contact page
In the past several hours, the euro has surged following the release of comments from German Chancellor Angela Merkel, who has said that the single currency is “too weak” for Germany – weakness which is “due to the ECB’s policy” and which “makes German goods…comparatively cheap.”
As of writing at 13:35 GMT, the euro is buying $1.1245 and remains close to its intra-day high (and new six-month high) at $1.1249. View article >
In Conan Doyle’s Hound of the Baskervilles, the legendary detective Sherlock Holmes solves a crime using his knowledge of what didn’t happen. Specifically, when Holmes learns that the victim’s dog had not barked during the night of the theft of a prized racehorse, Holmes knows that the offender is likely known to the dog – an insight which leads Holmes in the right investigative direction. View article >
Brazil’s financial markets are in shock following further revelations of bribery and corruption involving the country’s president, Michel Temer.
President Temer was yesterday forced to deny newspaper reports that he had discussed paying off a witness in an ongoing corruption investigation. And in a day of full scale political turmoil, two MPs began impeachment proceedings against Temer, and Aecio Neves, a political ally of the president and a man also accused of bribery, was suspended and had his home raided by police. View article >
The likelihood of a US rate hike in June is falling fast, as is the US dollar.
Just one week ago, the implied probability of the Federal Reserve hiking US interest rates at next month’s meeting – a probability derived from prices in Fed funds futures
contracts – stood near 85%. As of Monday, that probability had fallen to 74%, and at the end of yesterday’s session (Wednesday), it stood at roughly 62%. View article >
Bank of America Merrill Lynch predicted yesterday that the Australian dollar-to-US dollar exchange rate will fall to 0.7 within 2017 – a move that would mark a near-6% fall from yesterday’s closing rate of 0.7426.
Analysts at the bank have come to their conclusion following an in-depth analysis of Australian steel production rates and port shipment data, both of which they see as indicative of likely currency direction, and both of which are declining. View article >
The price of WTI crude oil rose by almost a dollar yesterday to $48.79 – it’s sixth daily gain in the past seven – and prices in the futures market for 62% iron ore held above $60 per metric ton, both of which gave a boost to commodities currencies.
Oil rallied after energy ministers from Russia and Saudi Arabia – the world’s top two oil producing nations – said yesterday that plans to limit oil output would be extended by nine-months to the end of Q1 2018. View article >
In the four-weeks leading up to last Friday’s close (May 12th), the Japanese yen had been one of the world’s worst performing currencies against the US dollar, falling 4.3% within that time.
The yen’s weakness during that period marks one hell of a turnaround from the four-weeks immediately prior, in which the yen was one of the world’s strongest currencies, gaining 3.9% against the dollar. View article >
It was a quiet day in markets on Friday.
The VIX index closed at 10.4, marginally higher than Monday’s dismal close in the index at 9.8, but remains near to multi-decade lows.
Commodities prices – key drivers of CAD, AUD, NZD and emerging market currencies – traded in narrow ranges. US WTI oil traded within a $0.72 range, its narrowest since May 1st. View article >
The Korean won finally made its move yesterday away from the 1130-to-1140 range against the US dollar. The exchange rate for USD/KRW had been trapped between the two prices for much of the previous ten trading days. At the end of yesterday’s New York session – the traditional end of the FX trading day – USD/KRW stood at 1124.30.
Renewed strength in the won has followed the election victory on Wednesday of Moon Jae-in, who succeeds former president Park Geun-hye as South Korea’s leader. View article >
The New Zealand dollar has fallen more than a cent against the US dollar following this morning’s RBNZ statement.
As expected by the market, New Zealand’s official cash rate was kept at its record low of 1.75%, but the dovish tone of the RBNZ’s accompanying statements has surprised many.
“Monetary policy will remain accommodative for a considerable period,” said RBNZ Governor Graham Wheeler. View article >