SGM-FX insights

Discussion and Analysis by Grace Gliksten   It has been reported that Prime Minister Theresa May won ministerial support to increase the Brexit offer from €20bn to €40bn yesterday. May is hoping that the increase will unlock stalled negotiations, but has been warned by Eurosceptic colleagues that this is conditional upon securing good transition and […]

Discussion and Analysis by Charles Porter:   The start of what promises to be an interesting and path-defining week has begun with similar action. The Euro lost considerable value overnight while coalition talks between Ms Merkel’s Christian Democratic Union and the Free Democratic Party unfurl. Whilst the evidence builds around May’s willingness to increase the […]

Discussion and Analysis by Charles Porter: The UK labour market remains healthy. Yesterday’s statistics release reflected the UK labour market in quarter three of 2017. The headline change was a moderately sharp fall in employment. However, when contextualised, this change looks insignificant due to the sustainment of a hyper-low unemployment rate, unparalleled for decades. Therefore, […]

Discussion and Analysis by Charles Porter:   A couple of months ago, the cloud looming over the United Kingdom’s political economy appeared to have receded, if only to show a lighter shade of grey. Following Theresa May’s Florence speech and the warm reception that it received from European officials, the Pound Sterling received a highly […]

Discussion and Analysis by Charles Porter: The Bank of England’s Bank Rate has been raised by 25 basis points. Strangely, the rate hike forced the Pound Sterling downward. The counter intuitive foreign exchange movements following the Bank’s decision are explained by a combination of the overpricing of a rate hike and a ‘dovish’ tightening. Whilst […]

Discussion and Analysis by Charles Porter:   This morning, at 09:30 BST, IHS Markit released its Manufacturing Purchasing Managers’ Index. The data approximates managerial sentiment within the manufacturing industry and is thereby used as a proxy to understand the domestic macroeconomy. The latest release of this fast-moving index demonstrated a tick up in economic sentiment […]

Brexit Discussion and Analysis by Charles Porter:   Italian Prosecco, German automobiles and French wine. While bargaining chips are poured out only to be raked off the table, Brexit is coming more convoluted. No deal is better than a bad deal; no matter what you make of that statement, we’re all relatively unified behind the […]

Discussion and Analysis by Charles Porter:   Bank of England: Stop and Think – Please!   This week was dominated by one event and so too will next week. Whilst monetary policy continues to, by and large, rule exchange rates, the Bank of England monetary policy decision on Thursday  must be watched closely. Despite a […]

Discussion and Analysis by Charles Porter:   A short while ago, the Office of National Statistics (ONS) for the United Kingdom released economic growth data in the form of Gross Domestic Product (GDP). Measuring the total value of goods and services within the economy over a given time period, GDP is the favoured statistic to […]

Discussion and Analysis by Charles Porter:   BoE: Stop and Think – Please!   Part Two: To raise rates or not to raise rates:     To analyse the relationship between the two components of inflation, the dual graph below models the effect of food and services inflation respectively against overall price inflation. These graphs […]

Discussion and Analysis by Charles Porter:   Bank of England: Stop and Think – Please!   Inflation within the United Kingdom is uncontrolled and rampant, surely, we have to raise interest rates! At least that’s what the first page of an economics textbook might suggest. In reality, a decision to tighten UK monetary policy on […]

Discussion and Analysis by Charles Porter:   Parliament is dissolved and the date is set for Japan’s election later this month. A bold political move by incumbent Japanese Prime Minister, Shinzo Abe, now looks likely to achieve its ultimate purpose. The significance of Japan’s election to the Yen cannot be understated. The importance spills over […]