SGM-FX insights

Global Markets H1 2022   On this the first business day of H2 2022, it’s a good point to look at the H1 report card for world markets. Those readers of a nervous disposition who prefer not to confront reality: look away now. Here are just 4 H1 2022 facts to make you sit up […]

As forecastable as British weather   Over the past six months a rapid adjustment and write-down in the pricing of many risk-exposed and interest rate-sensitive assets has exposed fears of recession and slowdown. The rapidly changing position of global central banks and a reappraisal of consumers and investors in the underlying economy has cast a […]

Torrid Tokyo   USD/JPY 136.20 with the Japanese Yen bumping along at its lowest level for 5 years for the past 3 weeks. But here is another one for the statisticians: Tokyo is suffering from its worst heatwave since 1875 ( not a typo!) and the power supply has little in the way of reserves […]

US 10 Year Treasury   Now yielding 3.12% some way below the peak of 3.48 on June 14. What does that mean? In a nutshell it means that fears of a recession are now outweighing those of inflation in the US market. The US economy shrank 1.4% on an annualised basis in Q1 2022 and […]

Automaticity   Further evidence of Central Bank speak mangling the English language: this time it is the Slovak and Finnish members who, while less strict on syntax are somewhat more rigorous in their fiscal approach than their more southerly colleagues now admonishing Italy which earlier in the week had the temerity to suggest that the […]

The battle of Japan   Trading flows have continued to pummel the Japanese Yen. Even as the USDJPY spot price crossed through 130, there was only a momentary pause before selling pressure continued. The record weakness in JPY had made headlines and forced analysts to question just how low the currency could fall. Despite a […]

An economic reality   Post financial crisis we have seldom seen volatility of the extent that we have experienced recently. Certainly, at least not on such a widespread level that has regularly been characterised by simultaneous write-downs in normally negatively correlated assets. Financial headlines last week at least attested to some concrete actions to justify […]

Swiss Roll   The Swiss Central Bank managed to shock markets that were widely expecting a rate increase from the UK’s Bank of England but not from Zürich yesterday. The 25bp UK rise having been expected meant GBP weakened by half a cent but the real action came when the Swiss reduced their rates from […]

Central bank mania   Heading into this week, markets had already braced for raised volatility in expectation of two key and much awaited central bank meetings. Those two central banks that were scheduled to meet were the Bank of England and the Federal Reserve. As you will recall, there has been a theme this year […]

British Pound   Already battered as we wrote earlier in the week, GBP came under renewed pressure yesterday from a stronger USD on the back of high US inflation numbers which gave rise to growing expectations of a more aggressive Federal Reserve response in the shape of an early 0.75% interest rate rise. This was further […]

Four Day Working Week   Beware of statistics: the rise in the number of 4 days a week jobs in the UK has risen by 90% post the Covid pandemic. But from a very low base. The jobs quoted are predominantly in the charity, hospitality and sales and distribution sectors which given the nature of […]

ECB   ECB President Mme Lagarde (finally) promised to acknowledge the rising cost of living led by food and energy prices by saying yesterday that the ECB was now minded to raise interest rates higher than was expected for the first time for 10 years citing higher inflation and lower growth expectations.   US Battery […]