SGM-FX insights

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 […]

Fed’s pickle The Federal Reserve is meeting next Wednesday for its latest monetary policy announcement. Focus upon the event has been immense. However, given the turmoil in the financial sector created by the forced sales of both Silicon Valley Bank and Signature Bank last week, speculation over the rate decision has been increasingly predicated upon […]

Is the US already in recession? Due to the mixed messages from recent economic releases on the state of the US economy with for example record low unemployment while at the same time there is increasing data on lay offs especially in the tech sector, it is worth asking the question: Is the US already […]

British Pound A better day for GBP as Sterling clawed back almost half of its losses from earlier in the week. Following Federal Reserve Chair Powell’s comments on higher for longer US interest rates on Tuesday, the USD strengthened sharply at the expense of all currencies and was then evidenced by a sickly looking GBP. […]

British Pound In itself not really a story but when a Member of the Bank of England’s Monetary Policy Committee opines on the UK currency, the market reacts. Yesterday it was the statement that if investors had not fully priced in the likelihood of further interest rate rises from both the Federal Reserve and the […]

US Employment Fasten your seatbelts for a big week on the US jobs front. After 517,000 new jobs were created in January, the expectation is for February to reflect growth in jobs but much less-200,000 in fact. At present US unemployment is at its lowest level since 1969 so the argument that the Federal Reserve […]

US Treasury Bonds With the 10 Year now back over 4 at 4.07% and the 2 Year at 4.90%, the market has in the past week or so moved dramatically and is now anticipating the Federal Reserve to err on the side of caution and do what it has in fact been saying for the […]

Inflation Following on from Friday’s US inflation release which came as an unwelcome surprise to markets, there was further evidence of stubborn inflation data releases in both France and Spain yesterday. All this adds up to implied  peak policy rates rising by 0.5% in February, the US to 5.4% and Europe to 3.9%. That compares […]

King Dollar Tired if not exhausted USD bears have begun to stir once again. The narrative is that with US interest rates having peaked and USD having enjoyed a long period of strength against all currencies including and especially Emerging Market Currencies, the USD’s time is up and the USD is now in long term […]