Dollar Builds on Recent Gains

  • The dollar remains resilient; optimism towards a Phase One deal continues to support risk appetite
  • There was also optimism from Fed Chairman Powell yesterday; the US economy is not out of the woods yet
  • Turkish President Erdogan started deploying Russia’s S-400 missile system, raising the specter of sanctions
  • Hong Kong reported weak October trade data; Philippine central bank Governor Diokno said a December cut was possible Continue reading “Dollar Builds on Recent Gains”

Dollar Remains Resilient

  • China announced it will strengthen its oversight of intellectual property (IP) violations, one the biggest points of contention in the trade talks
  • It is a holiday shortened week in the US, but there are still some major data releases
  • After the three largest UK parties delivered their manifestos, we can be sure of one thing:  there will be more fiscal spending
  • German IFO survey today came in as expected
  • Local elections in Hong Kong gave an overwhelming majority to pro-democracy candidates; Japan-Korea tensions have eased but questions remain Continue reading “Dollar Remains Resilient”

Dollar Edges Higher as Data Elsewhere Disappoint

  • US and China continue to work on a Phase One trade deal; Congress and the White House were unable to finalize a deal on USMCA
  • Canada reports retail sales; Mexico and Brazil inflation readings should support further easing
  • The Labour Party unveiled its manifesto yesterday, confirming its radical platform; UK and eurozone PMIs were weaker than expected
  • Japan reported weak data; Australia PMI readings disappointed Continue reading “Dollar Edges Higher as Data Elsewhere Disappoint”

Dollar and Equities Sink as Trade Pessimism Rises

Pessimism regarding a Phase One trade deal has intensified; further muddying the waters are recent US Congressional actions

FOMC minutes contained no surprises; regional Fed manufacturing surveys for November continue

South Africa is expected to cut rates by 25 bp to 6.25%

Korea reported trade data for the first twenty days of November; Indonesia kept rates steady at 5.0%, as expected Continue reading “Dollar and Equities Sink as Trade Pessimism Rises”

Dollar Firms as US-China Tensions Flare

  • The US Senate unanimously passed a bill in support of the Hong Kong protestors, inviting retaliatory threats from China
  • FOMC minutes will be released; Canada reports October CPI
  • A snap poll after the first UK debate gave a slight edge to Prime Minister Johnson
  • South Africa’s CPI came in slightly below expectations, bolstering our out-of-consensus call for a cut by the SARB tomorrow
  • Japan and Taiwan reported weak trade data; PBOC shaved 5 bp off benchmark Loan Prime Rates Continue reading “Dollar Firms as US-China Tensions Flare”

South Africa’s Risk Events

There are two risk events for South Africa this week: S&P’s rating review Friday and Thursday’s central bank meeting, for which we have an out-of-consensus call for a cut. While none of these events represent major risks for asset prices, they will give us important incremental information about what is still to come. Continue reading “South Africa’s Risk Events”

Dollar Stabilizes as Markets Await Fresh Drivers

  • Press reports suggest that the mood in Beijing is pessimistic after President Trump pushed back against tariff rollbacks
  • Fed Chair Powell met with President Trump and Treasury Secretary Mnuchin yesterday
  • Hungary is expected to keep rates steady; the deadline to form a government in Israel is fast approaching
  • RBA released dovish minutes from its November policy meeting Continue reading “Dollar Stabilizes as Markets Await Fresh Drivers”

Dollar Mixed as New Week Begins

  • The dollar remains under modest pressure; the US economy has slowed more sharply than expected in Q4
  • The Bundesbank warned that the German economy is likely to stagnate in Q4
  • Latest UK polls show the Conservative party consolidating its lead
  • China unexpectedly cut the 7-day reverse repo rate by 5 bp to 2.5%, the first since 2015; Thailand Q3 GDP grew 2.4% y/y vs. 2.7% expected Continue reading “Dollar Mixed as New Week Begins”

Dollar Mixed Ahead of US Retail Sales Data

  • Markets continue to dance to the tune of trade headlines
  • During the North American session, the highlight is US October retail sales
  • Banco de Mexico cut rates yesterday by 25 bp to 7.50%, as expected
  • Israel October CPI is expected to rise 0.5% y/y
  • Hong Kong tensions are likely to worsen; Malaysia reported Q3 GDP Continue reading “Dollar Mixed Ahead of US Retail Sales Data”