Brexit

Markets Jittery Again over Uncertainties Related to Trade Tensions and British Brexit

December 4, 2018

Share prices fell  539 points  or 2.4% in Japan, 1.0% in Australia, 0.8% in South Korea, 0.7% in Singapore and 0.5% in Taiwan. European markets have lost 1.4% in the U.K., 1.0% in Germany, 1.2% in Spain, 0.9% in Italy and 0.7% in France. In the U.S., the DOW and S&P 500 each lost 0.6% […] More

A Stronger Pound on Brexit Hopes

November 22, 2018

The dollar has declined 0.7% against sterling. European Council President Tusk kindled hopes for a Brexit deal, declaring, that a deal “has been agreed at negotiators’ level and agreed in principle at political level.” The British Ftse has fallen 1.0%, and the 10-year British gilt yield climbed four basis points. With the United States celebrating […] More

A Focus on U.S.-Sino Trade Talks and European Politics

May 22, 2018

Trade tensions between China and the United States appeared to lessen further as China announced it will cut tariffs on autos and progress was reported on a ZTE plan. Italy’s President Mattarella did not immediately endorse the Prime Ministerial choice of Giuseppe Conte proposed by a League and Five Star to lead the next government. Conte […] More

Some Fresh Surprises

May 10, 2017

Trump’s firing of FBI Director Comey in the middle of the investigation into Russia’s efforts to influence the 2016 U.S. election has given an upward yank to suspicion that the Trump campaign may have played a complicit role. The firing also served to remind investors that Trump is an uncertainty-seeker. Comments from the Dallas and […] More

Dollar Firmer Especially against Sterling

March 14, 2017

The British parliament granted Prime Minister permission to activate Article 50 of the Lisbon Treaty later this month. Doing so will begin a two-year countdown to negotiate terms and complete the process of leaving the European Union. The dollar advanced 0.8% against the pound in response. The dollar has also risen 0.2% against the euro, […] More

Currency Determination at the Intersection of Economics and Politics

July 14, 2016

Contrary to popular opinion, politics and economics do not operate in separate universes.  Politics is the business governing who gets to make the rules for all other business activity and how the laws will be enforced and interpreted.  Politics determines policy, and abrupt changes in policy and policy communication influence economic performance profoundly.  That’s why […] More

A Meaningful Financial Market Reaction to the British Vote

July 7, 2016

It was said by proponents of Britain leaving the European Union that predictions of dire financial market and real economic consequences were vastly overstated and that any repercussions would be fleeting and overall inconsequential.  Two weeks of post-referendum experience say otherwise. Sovereign debt yields have tumbled, suggesting an elevated risk of recession, the possibility of […] More

Brexit on the Mind and a U.S. Birthday

July 4, 2016

On this 240th anniversary of the U.S. Declaration of Independence, U.S. markets are closed, depleting currency markets of some leadership.  The dollar is little changed against other monies like the euro, yen and sterling. Nigel Farage, head of the UKIP Leave Party, resigned, creating more confusion about Britain’s next government and when the Brexit timetable […] More

Post-Brexit Market Moves Reversed Slightly Ahead of EU Council Meeting

June 28, 2016

The dollar settled back 0.9% against sterling and the kiwi, 0.8% versus the Australian currency, 0.7% relative to the loonie, and 0.6% vis-a-vis the euro and yen.  The yuan and Swiss are mostly unchanged.  Emerging market currencies did better today as well. Ten-year sovereign debt yields rebounded six basis points in the U.K., 3 basis […] More

Big Market Moves on Brexit Day

June 23, 2016

Polls have opened in the U.K. where voters are deciding whether to remain in the EU or leave.  Polls close at 10 PM local time.  Markets are positioned for a “remain” outcome. The dollar rose 1.3% overnight against the yen but is down 1.2% against sterling, 1.0% relative to the loonie, 0.9% versus the New […] More

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