SGM-FX insights

The other side of the coin After a short-lived period of revived volatility, ranges within EURGBP are becoming muted once again. Even for a major currency pair, the lack of volatility and tight ranges within EURGBP through the summer months was disturbing. Eventually a break of this range in favour of the Euro allowed some […]

BS Management This time BS as in Balance Sheet and the case in point is the US Federal Reserve. At the beginning of 2022 the Fed’s balance sheet stood at an all time high of USD 9 Trillion. As of now it is USD 7.9 Trillion. That is because the Fed in addition to managing […]

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 […]

Bank of England As most readers know, the Monetary Policy Committee is due to pronounce on the next move or pause in UK interest rates next week on 2 November. Having paused at 5.25% in September after 14 consecutive rate rises, the expectation despite the stubborn 6.7% rate of inflation is that there will also […]

Two Bills Yesterday’s market was dominated by comments coming from some highly influential financial voices. Not authorities this time, but investors and in particular two individuals: hedge fund managers Bill Ackman and Bill Gross. These two individuals had been very vocal about their short US treasury view and the need for benchmark traded US rates […]

Inflation and Conspiracy Theory Florida based Ned Davis Research captured a few headlines in the USA over the weekend with their analysis of Consumer Price Inflation in the period between 1966 and 1982. Having selected the time frame they then overlaid it with CPI for 2014 until 2023. Looking at the charts they do look […]

UK Economic Outlook The announcement earlier in the week that inflation is stuck at 6.7% has given rise to further examination of what’s in store for the UK in the next year: firstly the expectation is that base rates will remain above 5% until the end of 2024. Next under the microscope is the amount […]

A seller With US treasury prices still dominating flows across the world, do we need to worry about China’s swelling selling appetite? In recent memory China has always been one of the most significant holders of US treasury bills. Counting as quasi-FX reserves and a stabilising financial asset to hold within its coffers, China’s ownership […]

US Federal Reserve Given what feels like the near non-stop commentary on the path of US interest rates, it may be useful to break down where we are now in readily comprehensible speak given the predilection of the world’s central bankers to obfuscate with the Fed being one of the world’s leading proponents of opaqueness. […]

The Focus Markets have been dominated by the geopolitical risk presented by events in Israel and neighbouring geographies. Week on week, this has meant that the best performing G-10 currency has been the Swiss Franc benefiting from a safe haven, defensive move. Despite US treasuries taking a breather from their chaotic sell off, the US […]

Geo-Political Tensions While it has not been hard to disagree with JPMorgan CEO, Jamie Dimon on occasion since he is by inclination a prolific pronouncer, this time he is spot on: the world is faced with the most dangerous combination of challenges for several decades with the wars in Ukraine and In Israel. That in […]