The Big Four:
Riots across Paris this weekend by protect group gilets jaunes have wrought havoc across the city, seeing an emergency meeting called by the French President Emanuel Macron upon his return from the G20 Summit in Argentina. Despite not being significant enough in order to move the currency adopted by some 340m+ people across 19 countries, this dissatisfaction that has effervesced to the political surface of the French Republic embodied within these riots does increase the level of political risk within the European single currency. Increasingly, European politics in Germany, Italy, Spain, and now France poses a risk to the stability of the Euro. Respectively, the rising far-right, a weak coalition government endorsing fiscal profligacy, secessionist politics, and chronic dissatisfaction are plaguing these populations. Together, these four countries comprise of over 252 million people; nearly three quarters of the total Eurozone population without even mentioning their GDP contributions! Safety in numbers? It depends which ones you look at 4/19 or 75/100. Should investors lose confidence in an increasingly ailing Euro, contagion could set in. Of particular note this weekend was the progress on trade talks made between the United States and China. The frosty trading relationship between the two leviathans of international commerce has thawed with both leaders having claimed progress and an intention to reduce inhibitions to trade. Accordingly, defensive Dollar demands has weakened, leaving the US currency vulnerable today. Across the Pacific, the Chinese Yuan has enjoyed its biggest intraday jump in two years, making ground away from the important 7 figure within USDCNY.
Today’s Global Market:
Discussion and Analysis by Charles Porter
Click Here to Subscribe to the SGM-FX Newsletter
UK House Prices Unsurprisingly given the 12 interest rate rises and cost of living squeeze in the UK, the housing market has seen its largest year on year fall since 2009 when everyone was suffering from the global financial crisis. In the year to April the UK housing market has dropped by 3.4% with the […]
Opportunity for a weaker Dollar The passing of month-end allows markets an opportunity to reassess currency valuations. Despite a cooling off within the Dollar as forecasted following the agreement between the White House and Kevin McCarthy, month end flows yesterday showed favourable conditions for a short-term Dollar resurgence. The beginning of June coincided with headlines […]
Turkish Lira While President Erdogan removed the uncertainty overhanging the Turkish market by winning the election in the run off over the weekend, the news served to cement the certainty that nothing much was likely to change with respect to Turkish economic policy or indeed the subservient role of the Central Bank of Turkey to […]