SGM-FX insights

A testing week Markets so far have largely endured the admonitions coming from significant figures within the world of finance. The Bank of England’s own Andrew Bailey’s warnings of the risks of a market crash were uncommon for an MPC chair and initially took markets aback. Shortly thereafter, prominent figures warned of a pre-Halloween fright […]

World’s wealthiest non USA person That title belongs of course to the suave 76 year old Frenchman Bernard Arnault whose LVMH shares have suffered of late on the back of France’s economic and political woes combined with POTUS’ tariffs that had walloped the outlook for French luxury goods in the US market. On Wednesday of […]

UK Growth To refresh your memories, UK Growth fell 0.1% in July and the hope or more accurately the expectation was that July was an aberration which would be rectified when the men with the clipboards reported on UK Growth for August. In the case of Chancellor Reeves, that expectation was rather more of a prayer […]

A rising tide lifts all boats As the Dollar continues to perform lacklustre oscillations, key pairs remain rangebound. The trend so far this week has been for a mildly weaker Dollar. Given that the Dollar is considered the primary counterparty for most currencies, this creates a rising tide effect across the rest of the market. […]

China and the USA What prompted POTUS to escalate the trade war last week? Before answering that, it is worth a refresh on the current state of play: US tariffs on China average 58% and China on the US 33%, and the next cliffhanger date is November 10, after which the current threat is for […]

Calling time on Swissy Switzerland’s Franc may be destined to faulter under its own weight. Despite rock bottom interest rates, the Swiss Franc has been a significant beneficiary of the post-Covid and Trump2 world. EURCHF, a key barometer of European risk, shows some 20-cents worth of Swiss rally post-Covid. The pair has dropped from well […]

Friday night US Markets There was an element of the US stock market temporarily running out of oxygen at the heady heights that it had reached and looking for an excuse to take profits/sell. That excuse was provided in spades by POTUS who pronounced that he would implement much higher tariffs against China. That was […]

US Dollar A further lurch upwards for USD yesterday morning as French politics affected the EUR and the prospect of Japan’s first female Prime Minister as well as the accompanying uncertainty weaken JPY. GBP also feeling the effects of that strong USD. The USD/JPY at 152.80 also in uncomfortable territory for Japan. EUR/JPY 177.41. China Youth […]

A look ahead The UK Pound continues to be influenced by the gilt market and fiscal concerns. Sterling has been a very expensive short this year, contributing to its relative outperformance. In fact, the few episodes of sustained weakness we have seen tended to have either coincided with a global risk-off turn or a sharp […]

US Dollar For differing reasons USD is having a strong week both against the Japanese Yen and the EUR. Both currencies are weakened by political headwinds but that is where the similarities end. France is rather more influencing the EUR due to worries over its debt and its resistance to getting it under control. Japan […]

Le sick man of Europe? Over the decades, the phrase ‘sick man of Europe’ has been levied at many countries. Believe it or not, given its heralded status as the (often misfiring) engine of Europe and driver of growth, the phrase started life aimed squarely at Germany. The lesser loved UK, back when it was […]

US Government Shutdown In the past 50 years the US Government has shut down 21 times the longest of which was in 2018 which was for 5 weeks – and that to remind you was during Trump 1. Why might this time be different? This time POTUS has stated his determination to take the opportunity […]