New Overnight Developments Abroad - Daily Update
A Rebound in Many Emerging Market Currencies
August 14, 2018
The dollar has settled back 5.3% against the Turkish lira, 1.6% relative to the South African rand, 1.5% versus the Russian ruble, 0.9% vis-a-vis the Mexican peso, 0.5% against the Brazilian real and 0.25% versus the Indian rupee after touching a record low of INR 70.09 earlier in the day. However, today’s respite in the lira-led […] More
New Overnight Developments Abroad - Daily Update
Deepening Turkish Crisis Kindles Contagion Fears
August 13, 2018
The dollar has appreciated another 8.7% against the Turkish lira and is hovering around 7/USD. The lira touched a record low of 7.2 per dollar earlier. Turkish share prices have fallen 4.7%, and the 10-year Turkish sovereign debt yields climbed 51 basis points to 21.18%. Turkey’s central bank pumped fresh liquidity into money market by […] More
Foreign Exchange Insights and Next Week
Next Week
August 10, 2018
Central Banks: Monetary policy reviews in Norway and Indonesia. Reserve Bank of Australia Governor Lowe delivers semi-annual parliamentary testimony. Holidays: Assumption Day observed Wednesday in a few European countries. Indonesian Independence Day on Friday. Scheduled U.S. Data Releases: Quarterly productivity and unit labor costs. Monthly retail sales, industrial production, capacity usage, NAHB housing index, Empire […] More
New Overnight Developments Abroad - Daily Update
More Volatile Global Markets as Concern Mounts about Turkey
August 10, 2018
Turkey commands the spotlight of global financial markets this Friday. Talks broke down between the U.S. and Turkey over the latter’s continuing detention of an American evangelical pastor, which has prompted economic sanctions by the United States on an economy already gripped with upward spiraling inflation and a central bank interest rate near 18%. The […] More
Central Bank Watch
Filipino Monetary Response Escalated Amid Rising Inflation
August 9, 2018
A May central bank rate hike in May — the first hike of the overnight reverse repo rate since 2014 — was followed one month later by a second tightening. Both increases were 25 basis points in size, which these days is the most frequent incremental change favored by central bankers. But after meeting this […] More
New Overnight Developments Abroad - Daily Update
Declines in Kiwi, Ruble and Turkish Lira
August 9, 2018
The dollar advanced overnight by 1.6% against the New Zealand dollar, 0.9% versus the Russian ruble, and some 2.5% vis-a-vis the Turkish lira. Not only did the latest review of New Zealand monetary policy end with leaving the Official Cash Rate at 1.75%, half its level prior to the June 2015 first of 7 reductions, […] More
New Overnight Developments Abroad - Daily Update
Sterling Continues to Stumble on Hard Brexit Fears
August 8, 2018
Sterling hit new 2018 lows of EUR 0.9019 and $1.2859. The dollar is 0.6% stronger against the pound than its Tuesday closing level. The dollar is also up 0.3% versus the loonie, down 0.3% relative to the yen, and barely changed against the euro, Swiss franc, Aussie dollar or kiwi. Asian stocks were mixed Wednesday, […] More
New Overnight Developments Abroad - Daily Update
Softer Dollar but Higher Share Prices
August 7, 2018
The dollar softened overnight by 0.6% against the Aussie dollar, 0.4% relative to the yuan and euro, 0.3% vis-a-vis the peso, loonie and kiwi, 0.2% versus the yen and Swiss franc, and 0.1% against sterling. Share prices climbed 2.7% in China, 2.0% in Hong Kong, 0.7% in Japan, and 0.6% in South Korea. Equities in […] More
Foreign Exchange Insights and Next Week
Spotlight on Sterling
August 6, 2018
As a former hegemonic reserve currency with enormous residual offshore holdings, sterling is intrinsically susceptible to being shoved around disproportionately whenever favorable or unfavorable fundamental economic shifts arise. From $2.80 prior to the November 1967 devaluation, the pound slid to a low of $1.55 less than a decade later in October 1976 and touched an […] More
New Overnight Developments Abroad - Daily Update
Sterling Slide Extended
August 6, 2018
The pound ended last week on a weak note after Bank of England Governor Carney flagged “an uncomfortably high” risk that Britain leaves the EU without any negotiated deal. That message was reinforced over the weekend by Trade Minister Fox’s perception of 60-40 odds in favor of no deal, and sterling slipped a bit below […] More
