SGM-FX insights

Mirror, Mirror on the Wall   Headlines in newspapers and on television screens have been captured by two phenomena in recent weeks. They’ve scrambled to simultaneously grapple with the chaos unfolding within the UK’s exit from the European Union and the protests in Hong Kong. Yesterday, both took a huge leap. The direction of that […]

Is this a test?   2016; 2017; 2019. These three years have now all seen cable (nickname for currency pair GBPUSD) test its post-referendum low. Building a hyper price-sensitive area around the 1.20 mark, the pair has flirted with this low five times in these three years. This time, the direct risks levied against the […]

US-China Trade War   This Sunday 1st September sees the first of two rounds of U.S. tariffs of 15% on $300bn of Chinese goods which will hit a range of food such as meat and cheese as well as clocks and musical instruments. This comes on top of the tariffs on $250bn of goods that […]

Overreaction   Yesterday saw the implied probabilities of a no deal exit from the European Union rise within betting and foreign exchange markets. The source of the threat stemmed from Boris’ approved request to Her Majesty to prorogue Parliament. Translation: make lawmakers come back to work later than planned to prevent legislation legally blocking a […]

In the long run, we’re all dead   The quotation above is from legendary British economist John Maynard Keynes. These thoughts were offered in relation to the phenomena of fixed exchange rates but resonate strongly when considering yesterday’s market movements. US Commerce Secretary, Wilbur Ross, announced yesterday that the Trump administration would delay sanctions on […]

GBP   We have written about the various scenarios for GBP over the next three months several times in the past weeks and it is fair to say that the market continued at least until this week to ascribe a 10% chance of a NoDeal Brexit. That has now changed with 30% ie 3 times […]

Sevennnnn!   Yesterday the exchange rate between the US Dollar and the Chinese Renminbi broke through the 7.0 threshold for the first time since 2008. An initial glance at market action yesterday: Pound down, global equities some 2% off their opening price and defensive havens rallying might seem like overkill as a reaction to the […]

GBP and What is the Outlook over the next 3 months?   A number of our clients both private and corporate are asking us what the outlook for GBP is with the differing probabilities of outcomes on Brexit: No Deal is given a probability of 30%, a Deal by 31 October 15%, a delay to the […]

Waiting Game:     Voting has closed in South Africa’s national and provincial election, but it will take time to understand how the electorate expressed their will at the 22,924 polling stations across the nation. Results are scheduled to be released by May 11th and any exit or advanced polls are typically poor reflections of […]

Discussion and Analysis by Charles Porter:   There were high hopes for Australian Consumer Price Index inflation statistics released in the early hours of yesterday morning. The data released bucked the trend emanating from Australia this month. Showing under-expectation inflation, year-on-year inflation within the Australian economy fell short of the previous release. With monetary policy […]

Discussion and Analysis by Charles Porter:   The triumph of the Liberal Democratic Party (LDP) and Japanese Prime Minister, Shinzo Abe, over the weekend has driven the Japanese stock market skyward and the exchange rate downward. Whilst the certainty of a freshly mandated national government usually affords a domestic currency with value, the specific brand […]

Safe Haven Currencies are an imperative, yet complicated, business. Rising in value and price in the face of Geopolitical and general uncertainty and risk, their trend often defies not only other asset trends but also logic. In this article, we analyse known havens and the possible causes for their existence.    US Dollar   The […]