SGM-FX insights

A hawk for a hawk makes GBP rise   You may recall that the last Bank of England decision caused some upset within GBP crosses. It was the first decision in quite a while when the Committee was reduced to an eight-strong vote rather than its usual nine members, but it was specifically the absence […]

US Federal Reserve   “Substantial further progress” may sound like an end of term report card for a struggling pupil but that was as far as Fed Chairman Powell went with his prognosis for the US economy but restricted that view to the economy only meeting the criteria for inflation but not for labour. That […]

Emerging Market Shift   In the first half of 2020, lockdowns pervaded in much of the Western World. Despite the cause for economic concern in the world’s most developed economies, there was also cause for optimism with a new vaccine that promised to provide a conclusive end to the pandemic approved by one regulator or […]

Chinese companies listing in the USA   Many if not most US investors who buy Chinese stocks listed on US stock exchanges such as NYSE and Nasdaq believe that they are invested in the parent companies in China. There are two risks to that scenario: firstly they are invested in something called VIE’s or Variable […]

USD Surge   The publication of the Federal Reserve’s latest minutes provided a boost to the US Dollar last week. Whilst risk sentiment had remained fragile and US macroeconomic data had continued to be strong, the greenback had remained on the front foot for much of the preceding week. The market was looking out for […]

Germany   The post WW2 economic power house that is Germany currently looks a bit dented with economic growth for full year 2021 predicted to be 3.7%. So far so good. However what has market analysts scratching their heads is yesterday’s news of ballooning borrowing but much reduced production due to both supply chain and […]

Or Not.   As we wrote about last week, the decision to close the economy of New Zealand due to a suspected case of coronavirus within the community took a heavy toll on NZD. Against the US Dollar, the Kiwi did not find support at its recent lows reached earlier this month and set new […]

American August   Traditionally the time of tropical storms being given names and then often turning into hurricanes in the Caribbean, it is also the time that with trading bosses away on holiday, their deputies tend to react and over react to economic and political news which, in markets that are less liquid leading up […]

Oil   With WTI at $63.28, it’s lowest level since May, oil prices yesterday marked the sixth trading session in a row when prices have fallen. It’s based on two factors: supply or in the market’s view potential over supply plus ongoing and non receding Covid infections threatening to derail the global economic recovery. Those […]

Deflated   Moving into yesterday’s data release, markets were expecting July inflation to be read in the United Kingdom well in excess of 2%. The consensus forecast was 2.3% versus a previous figure of 2.5% in June. Both headline and core inflation came in far softer than expectations at 2% and 1.8% respectively. The reaction […]

Spain   The first tranche of EUR 9 billion funding was dispensed to Spain yesterday. There is a further EUR 60.5 billion promised to Spain from the overall EU EUR 800 billion recovery fund. Spain plans to revitalise its economy with these funds by digitising it and becoming greener. The question is whether those measures […]

Japanese Inflation   Generally when a country’s wholesale price inflation hits a 13 year high, markets reach for tin helmets and dig in, but in the case of Japan it has been met with more ho hum and smiles of disbelief given the lack of meaningful growth in Japan for many years. Global commodity inflation […]