SGM-FX insights

Berlin and Rome As we have written several times recently the German car industry is going through tough times as is the Italian car industry especially given the hard date of 2035 when the sales of diesel and petrol fuelled cars will no longer be permitted. Now their respective governments are indicating a softening of […]

British Pound The news that Goldman Sachs is predicting a GBP/USD level of 1.40 in the next 12 months reflects the positive sentiment based on interest rate differentials as we wrote yesterday plus a re-rating of the USD which seems less certain given the current geo political turmoil-see below. However GBP is now enjoying its […]

Ukraine Loan Russia has FX reserves of EUR 270 billion of which EUR 210 billion sits in Euroclear Brussels. The EU has stopped short of seizing those reserves which would be illegal but has come up with EUR 35 billion of the EUR 50 billion pledged to help Ukraine internationally. How? By borrowing EUR 35 […]

Bank of England As expected the Monetary Policy Committee left UK interest rates unchanged following yesterday’s  50 basis point cut in the USA and last week’s 25 basis point cut in the EU. Inflation at 2.2% is creditable given where it has been and for the moment it looks unlikely that the UK will cut […]

EU Business Sentiment Looking at the overall EU business sentiment, the Germany ZEW business sentiment mirrors it: both are at a 1 year low. Maybe just maybe later today the Federal Reserve could deliver a shot of adrenaline to the US and by inference the global economy with a big booster of a cut. Meanwhile […]

China A snapshot of China today gives more than a strong indication of the likely effect on the rest of the world’s economies. In August, China had record breaking temperatures – the highest for 60 years which was further exacerbated by thunderstorms which affected agriculture sending vegetable prices 22% higher than 1 year before. Despite […]

US Presidential Race Never mind Monday’s TV debate that saw Kamala or Calm La Harris land some well judged blows on Donald Trump, the news afterwards about Harris securing the endorsement of Taylor Swift may well be seen as a if not the turning point in her path to the White House. Swifties are numerous […]

French Parliament  Some more examination of President Macron’s appointment of Michel Barnier as his Prime Minister reveals more about the calculation behind the decision. Nothing to do with MB being known for being dull, nor for organising the 1992 Winter Olympics in Albertville and not even for his more recent role as EU Brexit negotiator. […]

Oil Why is oil at the year’s low? Look no further than the litany of reasons affecting the market as a whole. In no particular order: economic slowdown in China; vertiginous drop in Nvidia share price; disappointing economic releases in the USA particularly on Jobs and Manufacturing and last for good measure the expectation that […]

US Dollar With Chairman Jerome Powell’s “the time has come” speech at Jackson Hole, Wyoming USA the direction for USD in the next four months is down versus GBP, EUR and JPY. So far so easy in the fraught game of FX forecasting, but it would seem that Chair Powell has concluded that US interest […]

Business friendly European countries There are over 24 million Small and Medium Sized Enterprises in Europe and collectively they employ 85 million people. The countries rated as being the most friendly or hospitable to new businesses are Ireland, Bulgaria, Netherlands, Sweden and the United Kingdom. Rachel Reeves’ Budget on October 31st will determine whether the […]

German Parliamentary Elections Maybe not something to set the readers’ pulses racing but as an indication of the way that the tide is turning when it comes to German opinion on immigration, Sunday’s elections in Saxony and Thuringia in Eastern Germany will likely see the Alternative for Germany, hard right party top the polls. Chancellor […]