SGM-FX insights

An interesting day for EURUSD Taken in isolation, many of the events scheduled for today might be thought insufficient to threaten EURUSD. However, together, the concoction of releases concerning the currencies on either side of this pair could make for interesting trading during today’s session. Foremost on the list will be the Fed minutes. As […]

Germany In the past 20 years, Germany’s leaders have made two big bets: first depend on China for trade and second, depend on Russia for energy. Both look disastrous at the moment end of 2023. Although Germany is predicted to be a particularly poor performer economically in the next 12-24 months, together with its aging […]

Is that it? The defining feature of FX markets recently has been the deterioration in the US Dollar. A slight moderation in US yields has accompanied a shift lower in DXY. However, with the Dollar sell-off not maintaining an overwhelming degree of momentum, questions over the longevity of this shift in USD’s value are creeping […]

Eurozone With Eurozone core inflation now at 4.2 % but the economy stuttering at -0.1% growth, the forecast from a Reuters poll of economists is for a gentle increase in growth starting now: +1% in 2024 and +1.5% in 2025. Apart from that benign outlook being almost certainly wrong, it is notable for the non […]

European Interest Rates In short, unchanged after a spate of 10 straight rises. Despite calls for cuts, sensible ECB headmistress Mme Lagarde was having none of that at the scheduled press conference yesterday: too soon, she admonished and wisely counselled caution given the inflationary effect of the unfolding crisis in Israel and Gaza. Despite that, […]

ECB decision Later today the European Central Bank is scheduled to deliver its latest monetary policy decision. As a recap, the central bank has spent the last year publishing 10 back-to-back hikes to the benchmark rates within its suite of monetary policy tools. Today, however, it seems almost certain that European policy makers call time […]

USA Inflation In the year to end of September US inflation stands at 3.7%. While it has come down, the snag is that it is not continuing its downward trajectory as expected, and it is this sticky inflation that has strengthened the USD in the last hours of yesterday’s trading session. That has meant that […]

UK Branch Banking This week has revealed the difference in bricks and mortar strategies between the traditional clearing banks and first an ex building society now a bank and then a challenger bank. The clearing banks have been efficient and some would say ruthless in shutting branches. There are now 4,000 branches in the UK […]

The parapet With high US yields and strong US data publications, it is not the time for currencies to stick their head above the parapet. Unfortunately for GBP, the attention that the Prime Minister is drawing to himself, and the conservative party conference, runs the risk of highlighting the political risk associated with GBP. With […]

Surge Pricing Lots recently in the Financial Times and the examples of surge pricing in the price of concert tickets to see top name music artists. Once again and a bit of a theme for today, it’s legendary Group Pink Floyd and its erstwhile leader Roger Waters who is leading the way. To see Pink […]

Which is to blame? With EURUSD continuing to drive lower, it is important to question whether underlying concerns about the Euro or optimistic views amongst US Dollar bulls are responsible for the collapse in the pair. Whilst of course the answer is both, there seems to be an over emphasis within market commentary on the […]

European Central Banks Going in to the final few hours before the ECB announcement and press conference on interest rates, the expectation was for a rise of 25BPs to 4% which is the highest level since the inception of the EUR in 1999. The market was poised to send the EUR lower whether the decision […]