SGM-FX insights

Tame; Light volatility; Grab a handrail:   Yesterday’s three interest rate decisions fell into place as predicted. A tame and uneventful Bank of England rate decision saw the Pound do little more than flutter. With a 9-0 vote within the Monetary Policy Committee and interest rates being held at 75 basis points, expectations were met […]

  Rate Decisions All Around:   The United Kingdom, the European Union and Turkey all have interest rate decisions today. The order of importance and excitement is likely to follow that direction; with Turkey facing a pivotal and future-defining moment and little expected to occur at the Bank of England. There remains risk around the […]

Plain Sailing across the Channel:   This Brexit malarkey is a walk in the park! Well, that’s what the Secretary of State for Exiting the European Union, Dominic Raab MP, must be thinking! Largely coincidentally, since the departure of David Davis, news on Brexit has been overwhelmingly positive, providing a boost to Sterling: Barnier mentions […]

Realistic and Possible:   Four consecutive days of Brexit sentiment certainly has the Pound supported, but it has me concerned. The fragility of the statements presents a serious risk to the Pound should the expectations that news snippets have nurtured be undermined. Markets are in a risk-off mood this morning with safe havens including the […]

In the Green:   The Swedish elections have slipped by with relative quiet. The political risk that elections have brought to the domestic economy had been sufficient in recent weeks to push the Swedish Krone back down to critical lows last seen in 2009. The correlation and price action within major crosses over the past […]

Constrained ranges across the board:   The Dollar managed to hold its inflated value yesterday amidst growing concerns that its position is growing increasingly unsustainable. Domestic monetary tightening has benefitted the Dollar immensely throughout 2018, however, the Dollar’s appreciation has been driven by trade war fear mongering and the result of a ‘defensive demand’; hence […]

Buy the Rumour, Sell the News:   Magnificent volatility was seen in the Pound Sterling yesterday as traders manoeuvred themselves around little more than playground chatter. At market open, Brexit concerns had hampered the Pound, with positive PMI data insufficient to raise the domestic currency any more than a few basis points. In the euro, […]

Enough is enough:   Emerging markets looked to have snapped once again with the Turkish Lira, the Rand and the Argentine Peso tumbling by approximately 1% ahead of the European market open. Despite hefty domestic FX devaluations, emerging market stock indices have been harmed considerably; a seemingly textbook evolution of a systemic emerging market crisis. […]

Following a low volatility European trading day, the US session remained subdued as banks and the public observed Labor Day. A lack of confidence in emerging markets continue to be the dominant theme, with investors still unwilling to risk their money in assets including the Turkish Lira and the South African Rand despite the immense […]

With England’s World Cup well and truly over, the beacon of Love Island extinguished, and the UK frankly just a touch too hot, I assume I will be forgiven, perhaps even praised, for distracting your attention from these tragedies and delving into the UK’s monetary policy backdrop. For the second time in over a decade, […]

    A rapidly appreciating US Dollar has sent shockwaves through a previously tranquil market. The extenuation of an extant rally within the Dollar has been precipitated by the intensification of a trade war between the US, China and increasingly Russia. Coupled with a sustained and considerable tightening of monetary policy, with increasingly hawkish comments […]

Last Thursday, the European Central Bank undertook and presented what is, and what will be, arguably their most important monetary policy decision of this year. In keeping with the dominant theme from the Governor who hasn’t raised rates since he took office in 2014, the monetary policy decision was vague, dovish and resulted in an […]