Morning Brief – Currency Volatility

Currency Volatility

Recently we wrote about the possibility of market volatility arising from the elections and their outcomes that will take place around the world over the next 6 months. Looking at the DB Index of FX Volatility which currently stands at 6.3, it is more than worth noting that the 5 year average is 7.6 and the long term average is 9.3. The world has changed in trading composition and influence over the past 30 years and polarised around what is the G3 and that also makes for a more volatile market outlook when that G3 is comprised of the USA, China and Nigeria, India and Brazil.

EUR/USD 1.0817

World Economic Forum

Economists from the WEF have concluded that despite the world’s economies being interlinked and if not in lockstep will certainly move in tandem in 2024. So far so good, but it turns out that while growth in the USA and Asia is set fair for 2024, the prospects for Europe are bleak or flat at any rate. So while the world will grow healthily in 2024, there will be a gap in Europe. This will doubtless be translated into a change in the political weather in the EU elections in a week’s time when it is expected that the Right wing parties will see significant gains across the Union at the expense of the Social Democrat left and the Greens.

GBP/EUR 1.1755

Botnet

If you are unsure exactly what a botnet is, it is a network of computers infected with malware that is controlled by a person or persons who have malicious intentions. Before you dismiss it as of irrelevance, a

botnet can be very large and very organised like this one where the US Department of Justice has brought YunHe Wang a Chinese national and citizen of St Kitts and Nevis to book for the theft of USD 5.9 billion. If convicted he will face 65 years in prison for his part in the theft that involved hacking into 19 million Internet Protocol addresses in 200 countries. So if you need a timely reminder to change your passwords regularly and not click on links unless you are sure what they are, this is it.

GBP/USD 1.2720

French Honey

It turns out that pure French honey made by the leading European producer Famille Michaud Apiculteurs is not pure and is far from being completely French. In fact Famille Michaud Apiculteurs French honey has Spanish, Hungarian and Bulgarian honey which is at least European as well as Ukrainian which wants to be European so that’s a start. But then it turns out that it also contains far from France or even Europe honey from Argentina and Vietnam so the company is in deep EU regulatory water. That’s the buzz anyway. Sorry.

EUR/JPY 169.72

M.A.S.H.

Ten years after it was released in 1970 the theme from the hit TV series M.A.S.H. stood at the top of the UK charts this day in 1980. Not the jolliest of subjects but fans of the show propelled the music to commercial success not to mention Hawkeye and Trapper John and of course not forgetting Hot Lips Houlihan.

Through early morning fog I see
Visions of the things to be
The pains that are withheld for me
I realize and I can see

That suicide is painless
It brings on many changes
And I can take or leave it
If I please

The game of life is hard to play
I’m gonna lose it anyway
The losing card I’ll someday lay
So this is all I have to say

Suicide is painless (suicide)
It brings on many changes
And I can take or leave it
If I please

The sword of time will pierce our skins
It doesn’t hurt when it begins
But as it works its way on in
The pain grows stronger, watch it grin

Suicide is painless
It brings on many changes
And I can take or leave it
If I please

Have a Great Weekend!

Discussion and Analysis by Humphrey Percy, Chairman and Founder

Click Here to Subscribe to the SGM-FX Newsletter