SGM-FX insights

UK following the Rate Hike   Following the widely expected rise in rates yesterday by the Bank of England, market watchers were sifting through the tea leaves. Ahead of the meeting the Committee was split between raising rates by 0.25% and 0.50%. Once they met however, that became a pretty much unanimous vote for 0.25%. […]

UK   With the UK jobless rate falling to a 2 year low of 3..9% and average weekly earnings rising by 4.8%, a rate rise to 0.75% tomorrow by the Bank of England looks all but certain. GBP/USD 1.3070.   Electric Bentley   Following buoyant 2021 profits of EUR 389 million, Bentley has announced that […]

China and Asian FX   Markets haven’t always known where to look over the past couple of weeks as high volatility has been witnessed across all sectors. USD funding stresses look relatively well contained thanks to swap lines at respective international central banks allowing the demand for Dollars not to spill through to foreign exchange. […]

Hedging: the real world of aviation fuel   Often our clients ask us about hedging their currency exposures and request typical hedging strategies for them to consider. Nowhere is there currently a better example of the consequences of hedging versus not hedging than in the airline world with respect to aviation fuel. Last May British […]

ECB   Faced with the choice of choking off economic recovery or increasing the risk of getting (further) behind the curve, the ECB President, Madame Lagarde has taken the less hard decision of removing economic stimulus measures. Better that than wait for the inflationary effects of Ukraine to feed through further. EUR/USD 1.0985.   Oil […]

Metals   Copper $10,070 a tonne and at a record high as are Zinc and Aluminium. However Nickel puts them in the shade in terms of a move up-having been $54,880 on Monday it reached $101,365 per tonne before retracing to $80,000: 4 times the price at the start of 2022. Nickel is currently suspended […]

Stressed   A lot of commentary at the moment will talk of disorderly or stressed financial markets leading to abnormal price movements. They’re not wrong but it often gets lost or overlooked exactly what a distressed or disorderly market is doing. You’ll notice the symptoms of a market showing signs of vulnerability and stress in […]

Oil Sanctions on Russia   With real discussions actually taking place last night led by US Secretary of State Antony Blinken, the prospect of the EU and USA leading a wider block on buying Russian oil looks more possible if not yet probable. WTI closed on Friday at $115.68. The Iranian nuclear non proliferation deal […]

Markets     With market influencing news items coming in at speed over the weekend, it means that anything written on markets and the outlook for the week is of limited value given that events are moving fast enough to result in rapid price movements. However one thing is a certainty: expect increased volatility in […]

Market Moves   With US 10 Year treasury yields now at 1.96% and equity markets selling off sharply worldwide, not surprisingly USD stronger and EUR weaker: GBP/USD 1.3420 EUR/USD 1.1210. These moves left GBP/EUR unchanged at 1.1970 which reflects that EUR weakness. NYMEX WTI oil up at $94.60 and Gold up at $1,915. Wheat, Corn […]

Commodity Markets   Oil promptly lurched upwards on the back of yesterday’s developments in Ukraine with WTI at $94.13. Wholesale gas prices also jumped with April gas deliveries up 9% on the back of Chancellor Scholz blocking the certification of Nordstream 2 the new gas pipeline connecting Russia with Europe. Gold stands at $1,895. US […]

Markets   Those who doubt the precariousness of the situation on the Ukraine border should simply look at the following : US Treasury 10 Year now yielding 1.92% and EUR/USD 1.1320. GBP/EUR 1.2005. It remains to be seen how sanguine global equity markets are in the course of this week.   Porsche, Bentley, Audi, VW […]