SGM-FX insights

Germany Despite the ECB (European Central Bank) releasing a more optimistic outlook for inflation this week, careful Germans unlike their more profligate Southern European neighbours are spending less as they come to terms with much higher energy bills and much more expensive food costs. The Germans are also more worried about their personal finances than […]

UK Employment Unpacked   As well reported the ONS yesterday announced that those in employment declined by 52,000 in the past 3 months and the number of vacancies stands at 1.23 million. Unemployment declined by 0.2% and is at the historically low figure of 3.6%. The conclusion is that very few people seeking work are […]

Start the Week: Markets   As we begin the week, here are the key indicators that are flashing up on the currency dashboard: 2 Year Government Bond Yields in the US 4.33%, UK 3.12% and Germany 2.14%. Gold $1,771. NYMEX WTI Oil $92.61. EUR/USD 1.0350, GBP/USD 1.1835 and GBP/EUR 1.1430. USD/JPY 138.80.   US Equity […]

US Inflation   When the news came out of a lower than expected monthly CPI figure yesterday afternoon at 0.4% up versus the expected 0.60%, the market went mad sending Equities up and USD down sharply. That means that annual inflation is up 7.7% and so below 8% for the first time since the inflation […]

UK Food   With food price inflation of 14.7% from a year ago, it is clear that UK food buying habits are changing: Aldi and Lidl together now have a market share of 16.4%. That means two things: firstly shoppers are cannier and are seeking cheaper brands as that figure in 2008 stood at 4.4%; […]

UK Pound   As we start the week GBP is holding up in early trading in Asia Pacific but given the number of commentators writing bearish articles on the likely path of GBP, it will not be a surprise to see GBP lower as we get into the week from its current levels of GBP/USD […]

Bank of England   Yesterday’s meeting and subsequent release was the BoE’s biggest outing of the year in the wake of Trussonomics, the Gilt market meltdown and last but not least inflation at over 10% the highest for 40 years. If it had not been for the spotlight being shone on the events in the […]

UK House Prices   When UK house prices rise and the chattering classes regularly re-calculate the value of the equity in their homes while they scan the pages of the weekend property press, that fascination is often described as middle class porn. Well the stats yesterday consigned that top shelf material to the bin as […]

Key Week for the UK Market With the Bank of England expected to raise interest rates on Thursday by 75bps, the UK economy is stuttering beneath the weight of the sharpest set of rate rises in 33 years. If that is the correct treatment to crush inflation, it will have been worthwhile is the general […]

European Central Bank   The market’s focus was set firmly on the result of yesterday’s ECB meeting together with the ensuing press conference. Prior to the release the expectation was for a rise of 75 bps which was duly delivered. Italy 10 year Govt Bonds were trading at 220bps above Germany-a significant improvement from where […]

Management 101: UK   In investment banks at least, new management is hardwired upon assuming office to firstly trash their predecessors and then tell everyone just what a mess they have inherited but that things will soon be much better under their leadership. The UK’s (very) new Prime Minister Sunak lost no time yesterday in […]

FX Market Snapshot   With the USD little changed at EUR/USD 0.9860 and GBP opening the week in Asian markets at GBP/USD 1.1360 and GBP/EUR 1.1530, the big story which markets will be focusing on is where USD/JPY 149.05 goes next. Having broken through the psychological barrier of 150 last week, the question is not […]