SGM-FX insights

US Dollar Eye catching statements from President Lula of Brazil regarding Brazil supporting China in its call for the replacement of the US Dollar by so called de-dollarization with, funnily enough, the BRICS currencies ie Brazil, Russia, India, China and South Africa. Far be it for us to point out the obvious but Russia is […]

UK Growth: February 2023 It is fair to say that this piece could be rather short since the UK economy has not grown at all in February with strikes being given as the prime reason. Maybe it is therefore unsurprising that UK Chancellor Hunt has been very quiet since his Budget Day performance in March. […]

Minutes and data Yesterday saw the release of Federal Reserve minutes as well as the latest US inflation data. Both publications had been eagerly awaited by the market. The minutes were closely watched for their ability to confirm Treasury pricing and provide a control to traders’ understanding of sentiment at the Fed. Inflation data of […]

Isolated treasuries Several weeks ago, treasuries at the short end of the curve fell by around one percent within only a small handful of trading sessions. This meant that the valuations of US national debt due for maturity within a couple of years went up in value and much more violently than such instruments are […]

Markets As we start the first week of April that includes the end of the UK tax year, it is a good time to take stock of the markets as we embark on Q2. Starting with 10 Year Government Bond Yields, both the US and Uk are at 3.47%, Germany at 2.28% and Japan at […]

Breathing room, but not much Following Jay Powell’s recent private testimony to lawmakers, the market’s belief in the Fed’s conviction to stay the course on tackling inflation is rising. The testimony to lawmakers saw the Chairman confirm that dot-plot released during the latest Federal Reserve decision represented a fair summary of the view at the […]

US Interest Rates A frisson running through the Chartists among market operators due to 10 Year US Treasury yields having declined to 3.38%. By monitoring patterns and comparing those patterns to historical bond movements they have deduced that US interest rates have topped out and it’s all downhill yield wise from here. The final factor […]

Testing conviction With a Bank of England decision scheduled for later today and a Federal Reserve decision last night ringing in the ears of markets, traders should be braced for volatility. The decision last night by the Federal Reserve showed the FOMC treading a delicate path between demonstrating their commitment to taming inflation but being […]

Big Week With news about the arranged marriage of Credit Suisse to UBS announced on Sunday night following the bank’s CHF 50 billion liquidity line injection last week, repercussions from the failures of SVB and Signature Bank and fears for First Republic Bank despite a USD 30 billion multi bank rescue, expectations for a 50 […]

European Central Bank Doubtless the ECB wished that their awaited meeting and press conference had not been scheduled to take place yesterday given the fragile state of global markets. Although an improvement on the febrile atmosphere earlier in the week following the affirmative and decisive action from the Swiss National Bank in providing a USD […]

David and Goliath Yesterday’s FX market was characterised by heavy Euro weakness and a surging US Dollar. The only discussion taking place in the market yesterday, aside from a minor distraction in the form of Jeremy Hunt’s budget, was Credit Suisse. So, can the Goliath of the US Dollar really be undermined by a single […]

US Consumer Price Index Yesterday’s release must rank as one of the most closely watched numbers for many years given the Federal Reserve’s rhetoric, in the context of its rate rising policy, the mixed US economic picture and now the banking contagion fears following the failure of 3 sizeable US banks. Before the release, expectations […]