SGM-FX insights

US Jobs Data On Friday with an extra 165,000 US jobs of which 70,000 were in business and professional services, the US economy looked stronger than markets had expected. The AI led sell off prompted by fears that the Democrats will be more resistant to the data centres sprouting in all parts of the USA […]

After the US Elections It’s early days but here are just 4 conclusions that can be drawn from the swings to the Democrats in the US: 1. Some optimistic Europeans and also the EUR jumped to the conclusion that a weakened POTUS would mean the reversal of some tariffs on the EU: it will not, […]

Midterm Madness The dust has not yet settled from the US mid-terms, but the picture is still very clear. US voters turned Congress blue, leaving the Democrats in control of the House of Representatives and the Senate. The markets responded to this result with a risk-off move with one key exception: the Dollar did not […]

The UK Economically Inactive As PM Andy Burnham dodges rainstorms but courts Caribbean populist support by crafting an apology for slavery that ceased in the UK almost 200 years ago when the British Empire’s Slavery Abolition Act was passed in 1833, he might be more usefully employed putting his government’s mind to the 9.1 million […]

A lesson from the RBA? Overnight the Reserve Bank of Australia raised rates by 25-basis points. Stay with me even if you’re not an AUD observer, as this event is likely to hold lessons for regional and global markets. What was important about this decision is that, despite being widely anticipated, there were three dissenting […]

Two Complimentary Systems That is how EU Commissioner Ursula Von der Leyen described Canada and the EU in her speech on Friday’s EU-Canada Summit in Montreal. In concrete terms there is an ambitious agenda to co-operate on trade, bilateral investment, supply chains, AI, climate, security, the Arctic and programs such as Erasmus for student exchanges […]

UK Economy Now the dust has settled post Wednesday’s Autumn Statement or Mini Budget which as it turned out, was exactly that, taking the Office of Budget Responsibility’s two key forecasts, the UK economy can expect that inflation will stay higher for longer and that growth will fall in 2027 before increasing to somewhere between […]

A no-thrills affair Yesterday, UK Chancellor John Healey delivered his first budget to Parliament. The Chancellor’s predecessors had learned their lessons the hard way by leaking sensitive policy changes to the press prior to announcing them in the Commons. Perhaps usurpingly therefore, much of the content of the budget was unknown prior to delivery at […]

Central Bank Week This evening marks the start of 3 days of the outcomes of 3 Central Bank meetings when the Federal Reserve concludes its meeting and announces the results of its deliberations. Tomorrow it will be the turn of the European Central Bank and Friday will see the Bank of Japan concluding its own […]

One more risk As we wrote yesterday, a New York Times report that the US and Israel may have drawn up plans for military action against Iran following the mid-terms has continued to dominate markets. Energy commodities remain bid thereby sustaining significant headwinds against currencies including, but not limited to: ZAR, EUR, GBP, INR, JPY. […]

British Pound At present Sterling looks firm against EUR and as ever it is a US Dollar story which will dictate where GBP goes this week. As outlined below, the domestic picture will be dominated by Chancellor Healey’s Autumn Budget Statement, events in the Gulf and the Oil price will drive USD and France, its […]

France With a further increase in French Government Bond yields yesterday, the benchmark 10 year is now at 5.11% which means that markets are demanding a 15-year high premium of 173 basis points over German Bunds to take French risk. This premium is driven by three issues: political uncertainty(leadership weakness), France’s indebtedness (119% of GDP) […]