SGM-FX insights

A technicality Markets appeared to be fatigued by Trump’s Iran war before a ceasefire had even been agreed. This was evident from pricing that would have been considered complacent should the conflict have dragged on longer than it ultimately did. Now, that saga is far from over – it’s inevitable, for example, that as the […]

EU-China The EU has a trade deficit of almost exactly EUR 1 billion per day every day with China and there is an increasing debate within the EU as to what to do about it. At some point, China can expect a plea from Brussels to let the Yuan appreciate given that it is being […]

Another one bites the dust Yesterday, UK Prime Minister Sir Keir Starmer announced his resignation outside the door of 10 Downing Street. This is a sight that has become all too common in UK politics. Starmer will remain as a caretaker Prime Minister until his successor is chosen by the party. This resignation did not […]

UK Spend Given the probable change of 10 Downing Street incumbent and the even more probable identity of the new PM and his promise of change, it is worth looking as to how he could deliver on what are irreconcilable conflicting promises: no (further) tax rises and the continuation of the Triple Lock and a […]

British Pound While inflation at 2.8% and the prospect of a peace deal were cited as reasons to leave UK interest rates unchanged given the fall in Oil prices with Brent at USD 78.58, the effect on Sterling as we suggested earlier in the week was immediate: it fell sharply. That was before the result […]

Welcome Warsh Last night saw the new chairman of the Federal Reserve, Kevin Warsh, hold a press conference following his inaugural policy meeting. The importance of last night’s event is hard to overstate. The transition of leadership within the US monetary institution was far from smooth. President Trump had nominated Warsh following attempted legal action […]

Peace Deal As news begins to emerge from the G7 Evian les Bains talks, at the time of writing there is still very little either in detail or in writing as to what the 60-day US-Iran Peace Deal contains, resulting in more questions than answers. John Bolton the very much ex advisor to POTUS contends […]

Weren’t markets waiting for a deal? Yesterday was the first trading session after President Trump announced a peace deal with Iran. Since the start of this war, headlines from of the conflict have dominated headlines and financial analysis. The announcement of a deal allowed risk assets, primarily US equities, to rally strongly. This is non-negligible […]

British Pound Ahead of Thursday’s by election, it is worth looking at Sterling and instead of predicting gloom and doom – initially at least – pose the question as to what would make Sterling appreciate at this time? Economic growth: not apparent given that the UK economy is contracting slightly following a drop in spending […]

USD 30 million With US inflation at 4.2% in May from 1 year earlier, the room for manoeuvre for incoming Federal Reserve Chair Kevin Warsh is looking problematic. Gasoline is up 50%, airline fares 27%, clothing 5%, and electricity 6% from a year ago. The challenge of satisfying POTUS who is expecting interest rate cuts […]

ECB day Today’s interest rate decision from the ECB will be key for the Euro. With major Euro crosses trading at important technical levels, all eyes will be on Lagarde at the press conference that follows today’s decision. The market has been fully pricing a 25-basis point hike from the ECB for some time. It […]

Federal Reserve Today’s US inflation figures will be even more closely watched than usual given that the path of the Federal Reserve’s interest rate policy will in large part depend on how they look. Add into the mix the on-off and hopefully on nature of the Iran-US peace talks which alternatively drives USD down and […]