SGM-FX insights

UK Pound   As we start the week GBP is holding up in early trading in Asia Pacific but given the number of commentators writing bearish articles on the likely path of GBP, it will not be a surprise to see GBP lower as we get into the week from its current levels of GBP/USD […]

Bank of England   Yesterday’s meeting and subsequent release was the BoE’s biggest outing of the year in the wake of Trussonomics, the Gilt market meltdown and last but not least inflation at over 10% the highest for 40 years. If it had not been for the spotlight being shone on the events in the […]

Some way to go   The Federal Reserve somewhat caught the market off guard last night. The US central bank’s efforts in recent months to tame inflation have been nothing short of extraordinary. Late out of the blocks, the Federal Reserve produced last night its fourth consecutive interest rate hike of 0.75%. These enormous, oversized […]

UK House Prices   When UK house prices rise and the chattering classes regularly re-calculate the value of the equity in their homes while they scan the pages of the weekend property press, that fascination is often described as middle class porn. Well the stats yesterday consigned that top shelf material to the bin as […]

Yields tumble as fiscal progress is claimed   Having taken immediate action to reverse those promised taxation adjustments that had not yet taken effect or had not yet been passed by Parliament, Chancellor Jeremy Hunt still faces a huge challenge in restoring confidence to UK public finances. Measures that have been reversed include the cut […]

Key Week for the UK Market With the Bank of England expected to raise interest rates on Thursday by 75bps, the UK economy is stuttering beneath the weight of the sharpest set of rate rises in 33 years. If that is the correct treatment to crush inflation, it will have been worthwhile is the general […]

European Central Bank   The market’s focus was set firmly on the result of yesterday’s ECB meeting together with the ensuing press conference. Prior to the release the expectation was for a rise of 75 bps which was duly delivered. Italy 10 year Govt Bonds were trading at 220bps above Germany-a significant improvement from where […]

Budget delay   Following Rishi Sunak’s first full day in office yesterday there is an emerging feeling of relative calm within UK assets. The bond market appears to have been the driver of many wider asset flows with global yields falling as debt investor confidence begins to return. In the UK, yields, particularly on very […]

Management 101: UK   In investment banks at least, new management is hardwired upon assuming office to firstly trash their predecessors and then tell everyone just what a mess they have inherited but that things will soon be much better under their leadership. The UK’s (very) new Prime Minister Sunak lost no time yesterday in […]

Second time lucky Sunak   It may be second time lucky for incoming Prime Minister Rishi Sunak, but the wait from his first attempt wasn’t too long to endure. Following the withdrawal of leadership race competitor, Penny Mordaunt, he will be appointed as the UK’s youngest modern era PM by King Charles later today. As […]

FX Market Snapshot   With the USD little changed at EUR/USD 0.9860 and GBP opening the week in Asian markets at GBP/USD 1.1360 and GBP/EUR 1.1530, the big story which markets will be focusing on is where USD/JPY 149.05 goes next. Having broken through the psychological barrier of 150 last week, the question is not […]

UK   While widely anticipated, the new vacancy at 10 Downing Street for a third Prime Minister in 2 months left both the FX and Gilt markets relatively unchanged. That was due more to bemusement at the prospect of the Conservative Party even contemplating bringing back Boris Johnson. Consulting the bookmakers, Rishi Sunak is evens, […]