Foreign Exchange Insights and Next Week

The Euro, Yen and Peso

March 6, 2017

This coming Thursday, March 9th, will mark the eighth anniversary of the low point hit by U.S. stocks in the Great Recession. The DOW and S&P 500 closed that day at 6,547 and 677. The economy was reeling. 4.5 million jobs were destroyed in the half year through March 2009, a downward monthly pace of […] More

Next Week

March 6, 2017

Central Banks: Interest rate policy meetings are scheduled next week at the ECB (which will include new macroeconomic forecasts and be followed by ECB President Draghi’s press conference) and in China, Poland, Australia, and Peru. Governor Wheeler of the Reserve Bank of New Zealand speaks publicly, but Federal Reserve will be observing their practice of […] More

Next Week

February 24, 2017

Central Bank Action: Interest rate policy meetings in Canada, Ukraine, Malaysia, Hungary and Israel. Publication of Federal Reserve Beige Book of regional conditions. Evans, Lacker, Yellen, Williams, Bullard, Kaplan, and Brainard are some of the Fed officials who’ll be speaking publicly. Holidays: Brazilian Mardi Gras and South Korea’s Independence Day. Purchasing Manager Indices: Being the […] More

Some Factors to Consider When Handicapping Dollar’s Outlook

February 21, 2017

Fake News that is likely to become even more prevalent will present many challenges to currency forecasters. Even if the U.S. press and the intelligence community try to stand their ground, the executive branch of government enjoys great advantages in creating doubt and confusion in the public’s mind over what to believe. The two watchdogs are […] More

Next Week

February 17, 2017

Central Bank Activity: Interest rate policy meetings scheduled in South Korea, Brazil and Colombia. Minutes from prior policy meetings to be released by the Federal Reserve and Reserve Bank of Australia. The Cleveland, Philadelphia and Atlanta Fed presidents (Mester, Harker, and Lockhart) speak publicly as does the Reserve Bank of Australia Governor Lowe. February 20th […] More

Dollar Uptrend Back on Track

February 15, 2017

The dollar is back in the saddle. After a strong performance last autumn, the dollar hit a speed bump in January but experienced solid demand in the first half of this month. Against both the euro and yen, the U.S. currency posted gains in each month of last quarter. So far in February, it has recovered […] More

Next Week

February 10, 2017

Central Banks: Federal Reserve Chair Yellen delivers her semi-annual Humphrey Hawkins testimony on the economy and monetary policy to the Senate Banking Committee on Tuesday and the House Financial Services Committee on Wednesday. Fed District Presidents Lacker, Rosengren, Lockhart, Kaplan, and Harker speak publicly as well during the week. Chile, Indonesia, Sweden and Romania have […] More

Intervention Not the Only Way to Secure a Weaker Dollar

February 6, 2017

A previous blog post on this site discussed how U.S. currency market intervention might get dragged out of the forgotten monetary tools closet as a way to depreciate the dollar by the new Trump administration. Both the president and his key adviser on trade have called the dollar overvalued. The dollar has strengthened broadly since the U.S. […] More

Next Week

January 27, 2017

Central Banks: The first of eight scheduled FOMC meetings is on Tuesday and Wednesday and will not be associated with a published Summary of Economic Projections or a press conference by Chair Yellen. A policy meeting at the Bank of Japan on Monday-Tuesday will be associated with a released “Outlook” including revised macroeconomic forecast and a […] More

Is a Revival of U.S. Currency Market Intervention Coming?

January 26, 2017

I suspect it is. Foreign exchange intervention used to be a key tool of monetary policy, wherein countries buy or sell their own currency in the marketplace against a different widely traded currency. As such, FX operations are like the open market operations used to guide banking reserves and domestic monetary policy, but there’s a […] More