SGM-FX insights

UK Growth A fillip for the UK and Chancellor John Healey when the IMF marked up its report card for the UK with anticipated 2026 growth of 1.3%. Glossing over the stubborn consumer price inflation of 3.3%, pundits and politicians were swift to declare it as being good news. The Bank of England expects inflation […]

Positioning for Juxtaposition If these economic times feel unusual to you, it’s probably because they are. Two of the defining characteristics of the market at the moment are rock-bottom confidence in the real economy and sky-high costs of borrowing. This is perhaps best exemplified in the United States. Borrowing costs and confidence levels aren’t necessarily […]

Sterling Regular readers will have been following the almost spooky positive performance of GBP versus EUR. This is down to EUR being undermined by political and economic news from France-firstly the riots and secondly the poor debt position of France that has seen Italian Government Bond Yields at 30bps less than French Government Bond Yields. […]

Germany Good news for beleaguered German Chancellor Friedrich Merz as the German GDP forecast is lifted from 0.5% to 1.3% for 2026.The car industry may be enduring torrid trading conditions, the Strait of Hormuz may be mostly shut, but the German economy has been boosted by strong foreign trade numbers with exports showing an increase […]

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 […]