SGM-FX insights

Federal Reserve rate hike 27-07-22   Just as the market was bracing itself for a 75bp rate hike on Wednesday week, the inflation figure of 9.1% without a clear sign that that was as high as it was going came out. Cue talk of a 100 basis point increase that would take target Fed Fund […]

Uber   Back in August 2014 an ambitious ex banker had just been appointed Minister for the Economy in France and his name of course was Emmanuel Macron. Keen to make his mark and seeing Uber as a source of growth and new jobs, Macron invited the founder of Uber, Travis Kalanick in for a […]

US Unemployment   Shock horror: rates go up sharply and then chattering/scribbling market analysts are surprised that unemployment claims rise unexpectedly. That’s exactly what happened yesterday when initial unemployment claims rose to 235,000 for the week to July 2. USD riding high at USD/JPY 135.90.   UK Economy   Post PM resignation(more than enough said […]

Preparing for Parity   EURUSD broke through 1.02 yesterday during a punishing week for the Euro. The path now looks relatively open for a test of parity and most participants expect at least a temporary touch of 1:to:1. Having started the year in the mid-teens in this currency pair, the strengthening of the Dollar over […]

Markets   With the EUR on a 20 year low versus USD at 1.0287 and the Yen also floundering at a 24 year low, the USD is back in vogue with a vengeance as US Treasury 10 Year is now yielding 2.90%. This is what happens when markets fail to be convinced by central bank […]

Two tales   At the moment, expectations for monetary tightening are still ramping up. They have not yet reached their peak and probably won’t for a considerable period of time. Central banks are therefore largely stuck in a chasm between satisfying the demands of the market with respect to the way it is pricing national […]

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 […]