Foreign Exchange

The week that was so anticipated finally arrived. The Fed raised interest rates by 50bps ruling out the possibility of 75bps. However by the end of the week, fed fund futures are still pricing in 82.9% chance of a 75bps hike in at the June 15 FOMC meeting, to 1.50-75% Most pairs found some level…

The US Dollar ended the week  the strongest, having the best week since 2015 and with Dollar index hitting a two-decade high. The index moved to 103.92 its highest since 2002 as expectations of aggressive rate hike by the Fed in June. The Euro although performed better earlier in the week as Macron won a…

The US Dollar was the overall winner last week making impressive gains across the board. A further firming of yields and speculation of further Fed tightening propelled the USD.  The market is now expecting a 50bps rate hike in May and could end the year between 2.5% and 3.5% depending on incoming data and developments…

Last weeks rising yields continued. This led to a week of further downward pressure in bonds and interest rate rises. The Box and RBNZ both moved 50bps higher which caused risk assets to move lower.   The shortened week for the 4 day easter holiday saw the US Dollar grind higher. The flight from risk…

The week started as the following had ended. Markets were relatively quiet. The war in Ukraine had continued to ebb away from headlines and the markets were able to begin to focus on other factors.   The US Dollar ended the week the strongest despite the mixed start. The markets waited until the Fed minutes…

The week was quieter on many fronts. The continued war in Ukraine has now seems to have completely stalled for the Russians. The announcement of a more focused approach on the Donbas region seemed to indicate that a move for total control over the control had failed. Continued talks did not prove to garner any…

The war in Ukraine seemed to move from the spotlight as any developments continued to stall the main themes for the week was the continuing rising yields.   The Yen was the biggest loser as global yields surged except the JGB. The BoJ has clearly put a cap on 10-year yields and the resulting widening…

The week saw the current war in Ukraine stall. With this we saw the Euro gain slight momentum   GBP gained as the BoE again raised rates by 25bps. However this was not enough for the currency to gain any real upside momentum. The market had eyed a potential 50bps rise and with less than…

The week saw some level of stabilisation after the previous 2 weeks of roller coaster markets. Ukraine continued to dominate the headlines but with no further escalation the markets sought to remain calmer than previous weeks.   The USD which had seen safe haven status over the last 2 weeks gave up some ground to…

The week was once again dominated by the continued invasion in Ukraine. Euro was the worse performer of the week as the attack on the Zaporizhzhia nuclear power station brought the real issues of the conflict into focus.   The war in Ukraine has generated two clear effects in FX markets: The European currencies most…

The week was dominated by the build up of forces and eventual invasion of Ukraine. Though not unexpected by the markets the actual event still took them by surprise.   Risk assets initially tumbled on Thursday as reports of the invasion broke but by late on Thursday staged a complete comeback and had turned positive…

The ongoing military build-up in eastern Europe continued to dominate the market headlines. In the early stages of the week there was general optimism about the situation, with risk rallying on hopes of the situation getting diffused. However, in the latter part of the week the fear of escalation returned, and risk assets got sold.…

It seems not a week goes by without some level of event driven volatility. Late in the week rumours of Russia /  Ukraine escalation saw Euro move lower. Oil surged to a new 7 year high and Equities lost ground. In the background we still see the Fed tightening rates ahead. Investors were concerned that…