German current account
T.G.I.F.
December 12, 2025
As 2025 sprints to the finish line, the weeks have gotten exhausting and confusing. Just under three full weeks remain, and the last two will be distorted by the holidays. Overnight changes in the dollar have not been significant, but that doesn’t change the softening trend of the dollar since just before Thanksgiving. The DXY […] More
U.S. PPI and ECB Rate Announcement Fail To Clarify Confusion about Future Inflation and Central Bank Interest Rates
April 11, 2024
Central bankers have consistently sent a message that disinflation will be a bumpy process and that monetary policy normalization will hinge on growing confidence that inflation targets will be fully resecured. In other words, time and evolving information will dictate what is done. It is not apparent if inflation will meet these parameters without a […] More
Potentially Momentous Week Starts Quietly
November 13, 2023
The dollar edged 0.2% higher overnight against the Japanese yen, Canadian dollar, Swiss franc, and both the Aussie and New Zealand currencies. The dollar firmed 0.1% against the euro but slid 0.1% relative to sterling. Share prices in the Pacific Rim closed mixed, with gains of 1.3% in Hong Kong and 0.9% in Taiwan but […] More
An Historic FOMC Meeting on Tap Amid High Inflation and Some Cautious Optimism about the Pandemic and Diplomatic Efforts for a Russian Cease-Fire
March 16, 2022
The size of today’s initial federal funds rate hike is expected to be 25 basis points. I personally would prefer to see a bolder opening move of 50 basis points, as a symbolic gesture that Fed officials recognize that interest rate lift-off is starting late. But the credibility of forward guidance lies in not whip-sawing […] More
Lessening Risk Aversion
February 9, 2022
The recent sell-off in bonds has taken a step back, and that has encouraged bottom-feeding in equities. Nonetheless, markets have come a long way in the first five weeks of 2022. The 30 year U.S. fixed mortgage rate rose another five basis points last week and, at 3.83%, was 56 basis points above its end-2021 […] More
A Stew of Concerns about Climate Change, Covid, and the Fed Possibly Tapering Soon
August 9, 2021
A UN-sponsored study by scientists claims it is already too late to prevent significant further climate disruptions in the next couple of decades. In the United States, fires continue to rage, and the Pacific Northwest braces for another heat blast. Newly identified daily Covid cases in the United States have exceeded 100k for five straight […] More
Signs Emerging that Inflationary Momentum May Be Flattening
June 9, 2021
Consumer prices in China recorded their third month-on-month drop in a row, slipping 0.2% in May after declines of 0.3% in April and 0.2% in March. That didn’t prevent another acceleration of on-year CPI inflation, which advanced to an 8-month high of 1.3%. Moreover, price pressure at the producer level rose sharply again from 6.8% […] More
Slightly Softer Dollar Ahead of the Start of Trump Impeachment Trial
February 9, 2021
The dollar lost 0.4% in trade-weighted terms and is also down 0.6% against traditional hard currencies like the euro, yen and Swiss franc. The value of a bitcoin advanced to yet another record high of $48,000. Dollar weakness extends to many commodity-sensitive currencies and to gold, which is 0.6% firmer. Day one of the Trump […] More
Optimism from the Vaccine and Policy Developments
December 9, 2020
Once again stocks have risen and the dollar fallen from optimism that the arrival of vaccines means the beginning of a return to a better normal. The focus on vaccines coincides with difficult trends in Covid cases, deaths and hospitalizations. New cases in the past 24 hours exceed 600k globally and 216k in the United […] More
Investors Excited by Vaccine Trial News and U.S. Election Results
November 9, 2020
Stock markets are rallying on two pieces of news. Initial results of Pfizer’s large-scale trials of a Covid-19 vaccine have reportedly demonstrated 90% effectiveness among people without a prior condition. Donald Trump has lost his bid for a second term as president, but Republicans appear to have retained control of the senate. This combination of […] More
