SGM-FX insights

Have we forgotten the budget? Despite a significant up-tick in realised volatility across the board, options pricing remains relatively contained. Take GBPEUR, for example. The pair has been moving significantly higher in recent sessions whilst a blow-out in Eurozone bond spreads undermines Euro-sentiment. The foundations behind that move are questionable (more below) but the sell-off […]

US Debt Solutions With the USA spending USD 1 trillion per annum on servicing a debt mountain of USD 40 trillion, unless there is a drastic cut in spending or and a drastic increase in tax revenues, it can only get worse. In 1961 in Operation Twist the US artificially depressed the steepness of the […]

NFP relief Friday saw the release of the latest all-important non-farm payrolls report. The publication showed just 29k jobs added to the US economy in September. That compares to August’s read of +162k and a consensus forecast of +49k. The fact the NFP report missed expectations should be welcomed by Europe. The Euro had been […]

EU Inflation Now up at 3.8% at almost double the 2% target rate, Eurostat ( the clue is in the name) would have us look at core EU inflation which is 2.5%. That begs the question as to whether it is really sensible to strip out energy, food and tobacco which accounts for almost half […]

In the Barrel Yesterday marked my 52nd anniversary in the City which is worth reporting here for the changes that have taken place in both the physical landscape of the City and the technology supporting the markets. There were still overt signs of WW2 bomb damage in the many areas of wasteland used invariably as […]

2% September Yesterday the Dollar capped off its best month since March. The Dollar index closed the month some 2% higher than its opening level in September. The main theme behind that value-shift has been the market’s evolving relationship with the central bank. Before the Federal Reserve’s mid-month quarter-point hike, the market hadn’t believed in […]

Oil Traditionally the drivers for markets being Inflation, Economic Growth, Government Bond Yields, Equity Markets and Oil have all taken their turns in being the prime determinant which traders would reference. Today it is Oil and Energy prices that are driving Inflation and Government Bond Yields, as a continuing USD 100+ oil price is the […]

Conference This week sees the Labour Party hold its annual conference. Taking place in Liverpool, the conference is an opportunity to rally the back benches, party members and the electorate alike. The primary focus allows the party’s leadership to take to the stage and espouse their vision for the period ahead. Gulp. For Prime Minister […]

Markets Round Up After a week of plenty of jaw jaw from Federal Reserve governors on the need to crush inflation, US Treasury Bond yields well through 5% except in the 2 years where they are nudging 4.90% and strong economic data in the US, on Friday the USD gave back a small amount of […]

European Fuel Prices The nearly 7-month Gulf conflict is doubtless the topic of most note for European delegates to the UN General assembly this week as well as weighing heavily on POTUS given the impending midterm US elections. The European electorates are suffering petrol pump prices as follows in EUR: Netherlands 2.43, France 2.27, UK […]

Value shift A broad-based dollar advance has left key Dollar-crosses testing the extremities of recent ranges. The source of that Dollar rally can be attributed to a combination of many factors. Arguably the most important amongst those has been strong US economic data. The start of this week saw a relatively light data schedule allowing […]

USA-China In a highly anticipated summit today sees the kick-off between Presidents Xi Jinping and Trump in a return match at the White House – although the State Dinner will be held in a tent on the lawn as POTUS like all good Home Depot customers is having an extension done at the moment. Lots […]