Yen
Dollar Uptrend Substantial Already
November 12, 2014
Despite deepening concern about the euro area’s economic outlook, the dollar’s recovery versus the euro understates the U.S. currency’s overall turnaround. EUR/USD had declined slightly less than 10% since the start of 2014 but only 5.5% since the end of 2012. Almost 7/8ths of a 33% plunge in the Russian ruble since end-2012 happened this […] More
Spotlight on Japan and APEC Meetings
November 11, 2014
Dollar/yen hit a new high for the move of 116.12 and shows a net overnight advance of 0.9%. The yen also touched a low of 144.02 per euro. The Japanese Nikkei gained 2.1%, supplanting 17K to 17,124. The ten-year Japanese JGB yield rose four basis points to 0.48%. Greater optimism toward Japan’s outlook has followed […] More
Volatile Markets in Aftermath of Republican Big Win
November 5, 2014
Republicans retook control of the Senate and will hold at least 52 of the 100 seats. Republicans defended the House of Representatives where they will hold at least 56% of the seats. Republicans also will control 5/8ths of the state governorships. In more cases than not where Republicans won, the margin of victory was greater […] More
Significant Monetary Policy Changes in Japan and Russia
October 31, 2014
Quantitative and qualitative monetary stimulus was expanded sharply in Japan by a 5-4 vote, with the central bank governor and two deputy governors siding with the majority. The impact of the decision to boost annual JGB buying from 50 trillion yen to 80 trillion yen, triple holdings of ETFs and J-REITS, and lengthen the average […] More
Financial Trick or Treat
October 22, 2014
The ‘Trick or Treat’ greeting of Halloween revelers offers a choice of extremes. The handover of a holiday sweet is a happy moment for giver and receiver alike, while the contrary exchange of an act of vandalism for getting no candy leaves all parties dissatisfied. There’s no middle ground, and so it has been for […] More
Bolder Official Efforts to Influence Currency Movements
September 25, 2014
Officials outside the United States had for some time been frustrated by the weakness of the dollar in spite of superior U.S. fundamental economic comparisons of real growth, labor market conditions, and interest rates. Now that the Federal Reserve’s third round of quantitative easing is wrapping up and speculation is heating up about an initial […] More
A Strong Dollar Is in the Best Interest of Everybody Else
September 11, 2014
In the mid-1990s, former U.S. Treasury Secretary popularized the phrase that “a strong dollar is in the best interest of the United States.” What he meant was that if the dollar is expected to appreciate, it will suppress actual and expected U.S. inflation, reduce long-term interest rates, promote business spending and direct investment inflows by […] More
September Introduces New Stuff to Watch in Currency Trading
September 4, 2014
The ECB announced some meaningful stimulus today. The Bank of Japan, which made its big play, is now the central bank in need of stimulus that seemingly fallen behind the curve. The tone of U.S. data has progressed this year from disappointing to mixed to, most recently, increasingly positive. And the dollar this week has […] More
Dollar Uptrend Extended after U.S. Labor Day Weekend
September 2, 2014
The dollar rose to a 1-year high of $1.3110 and a 7-month high of JPY 105.03. From Monday closing levels, the dollar currently shows gains of 0.6% against the yen and kiwi, 0.5% relative to the Australian dollar and sterling, 0.4% versus the loonie, and 0.1% vis-a-vis the euro and Swiss franc. The yuan is […] More
A Modest Proposal
August 14, 2014
Tomorrow will mark the 43rd anniversary of the most famous event in modern currency market history. I refer to former President Nixon’s decision to sever the dollar’s link to gold. The dollar devalued four months later in a vain attempt to reestablish fixed parities. A second dollar devaluation followed 14 months afterward in February 1973, […] More
