SGM-FX insights

ECB President As predicted, Mme Lagarde, President Christine Lagarde yesterday stuck to her existing line that it was all much too early to talk about interest rate cuts in the Eurozone. The market or rather 60% of those polled are holding out for the first such rate cut occurring in April. Maybe that 60% should […]

UK Election The current political situation in the UK is delicate. Fortunately, by contrast to the often calamitous moments of the Johnson and Truss eras of governance, political risk is being somewhat overlooked. We are likely in an election year in the UK, at least that’s what the Prime Minister has recently told us. A […]

Question Without wanting to sound alarmist the question is whether markets have factored in the geo political risks present due to the conflicts in Eastern Europe and the twin conflicts in the Middle East which are overlaid by the vast number of general elections scheduled for 2024. Maybe a better way to express the question is […]

BoJ: could we have expected more? With a relatively light economic calendar so far this week, the BoJ’s monetary policy decision overnight stands out as a major event. As always, the divisive monetary policy approach taken in Japan led to debate over whether a change of course will be offered. Hopes that the new governorship […]

De-Dollarization in Africa More on this story with real life examples of countries or rather one country in particular not just talking about it, but actually doing it: China. Bank of China has operations in Kenya, South Africa and Zambia. But when arriving at Kenneth Kaunda International Airport in the Zambian capital of Lusaka, Bank […]

EU Wage Growth In recent years wage growth has been the Cinderella of the inflation index but it now it is more a case of militant tendency when it comes to pay settlements. The wage growth pencilled in by the ECB consistent with their inflation targeting is 3%. Clearly the German railway workers’ union has […]

Flavour of the week The summit taking place in Davos brings with it a huge opportunity for leaders of companies and industry to speak with the press. Whilst the World Economic Forum is billed as a venue where titans of industry come together to get business done, it often seems more like a hunting ground […]

US Economy The greatest risks to the US economy in 2024 at least according to 1200 US business leaders polled last week are in order as follows: Recession, Inflation and Interest Rates. Nothing unexpected there. However tacked on to the end was the fourth greatest risk at least to domestic US corporate chiefs, although outside […]

Does Iowa affect the Dollar? By Iowa I of course mean the events in the Republican nomination race that have dominated business, political and financial news flows overnight. The polls and pundits had far from ruled out Trump as the Republican candidate for the race to the White House. However, the margin by which Trump […]

Shanghai Containerised Freight Index Instinctively one would expect that freight costs have increased and probably quite a lot since October 7 and the outset of the war in Israel. With Friday’s sharp rise in the SCFI due to the US/UK actions against the Houthis, the Index stands at $3100. That translates as the cost of shipping […]

US Inflation In the end the much anticipated December US inflation figure yesterday came in at 3.4% versus the 3.2% expected and the November 3.1%. While that may not look like much of a difference, it is a signal that is unwelcome in the market especially when core inflation is only just below 4% at […]

Hello again With the festivities now having passed us by, a defining feature of 2023 markets is set to return in earnest. Aside from the non-farm payroll show that must always go on, the data calendar almost ceased over the Christmas period. For those interested in the above statistic released on the first Friday of […]