SGM-FX insights

European Central Bank News Conference   While economic policy was left unchanged and no further stimulus was announced yesterday, it was clear that that was firmly on the agenda for the next ECB meeting in December. As a reminder of the numbers the ECB has set aside EUR 1.35 Trillion for bond purchases in the […]

Tumble   Stock, currency and bond markets alike burst into life yesterday. Following the close of the German and French major stock market indexes some 4% in the Red, the price of assets across the globe started to reflect growing discomfort with the macro economy. US stock futures had initially shrugged off the sell-off taking […]

Interference   We have become increasingly accustomed of late to sideswiping headlines gripping price action and throwing currencies in entirely opposite directions. The past 24 hours provided no respite to the torrent of headlines. But the salience and long run ramifications of yesterday’s major headlines could be far more significant than we are used to. […]

China   People’s Bank of China Head, Yi Gang stated this weekend at an online banking seminar to the G30 what many in the markets already suspected: despite Covid starting in China and almost a year ago having shut down large parts of China’s economy, not only is China back and enjoying an expansion in […]

Germany   After the Great War ended in 1918, what is now Germany’s population stood at 60 million. By 2019 and 100 years later that had grown to 83 million. Looking at the graph with a succession of policies encouraging guest workers the increases have been steady and regular. For the first time in 2020 […]

Aussie Coal   The AUD was hit yesterday after China instructed state owned utilities and steel mills in China that they should stop importing Australian thermal and coking coal immediately. The AUD fell 0.5% on the news but later recovered a bit after the market worked out that it is not simple to substitute other […]

Apart from being National Farmers Day globally, today is a public holiday in the USA to celebrate Columbus Day and the discovery of what in 1492 was the New World….   Cyprus and the EU   Later this week the EU meets to discuss an agenda that includes the imposition of sanctions against Belarus for […]

sPain   Distress in the Eurozone is normally reflected in financial markets by rising spreads between peripheral (read: Italian) and core (read: German) assets. The so-called ‘BTP spread’ measures the cost of borrowing money in Italy versus in Germany and is one of the key barometers of European financial stress and risk. In fact this […]

US Dollar   Longer term and by that I mean in the 6 to 12 month time horizon it is looking increasingly likely that USD will weaken substantially due to two key factors: firstly, domestic savings are falling faster and the savings ratio is lower than at any time in the past 70 years, and […]

One Million   The official coronavirus death count has now risen above one million. This toll counts diagnosed cases of the virus where the new coronavirus has been listed as a cause of death. Frequently a nation’s death toll from COVID-19 has been subject to politics and a steep learning curve across the globe when […]

Hospitality Sector   In July this year UK Chancellor Rishi Sunak came up with a novel way to get diners to return to cafes and restaurants with his Eat Out to Help Out Scheme. But as time goes on, restaurants are needing to become more inventive and this week the winner (so far) has been […]

Tin   As demand for electronic goods slumped at the beginning of LockDown, tin fell to $12,700 in March. The bulk of tin – more than half-is used as solder in electronic products to connect components. By the beginning of this month, tin had risen to over $18,000 but having now slid back to $17,500 […]