Scandie Central Bank Preview

The Riksbank and Norges Bank both meet this week. The two are on different trajectories that should be underscored by the meeting outcomes; while the Riksbank is widely expected to stay on hold, we see the risk of hawkish language from the Norges Bank. This in turn could lead to some NOK outperformance that sees the NOK/SEK cross recover some of its recent losses. Continue reading “Scandie Central Bank Preview”

Drivers for the Week Ahead

  • The dollar is likely to remain under pressure
  • With the media embargo lifted, quite a few Fed officials will speak this week; Fed manufacturing surveys for September will continue to roll out; Canada Parliament reopens Wednesday with the Trudeau government presenting its new fiscal agenda
  • EU summit begins Thursday; reports suggest the ECB has launched a review of its PEPP; eurozone and UK Markit flash PMI readings for September will be reported Wednesday
  • Riksbank meets Tuesday; Norges Bank and SNB meet Thursday
  • Japan and Australia flash PMI readings for September will be reported Wednesday; RBNZ meets Wednesday and is expected to keep rates steady at 0.25% Continue reading “Drivers for the Week Ahead”

EM Preview for the Week Ahead

EM currencies are coming off a solid week. The dollar remains on its back foot after the Fed delivered a dovish hold and US economic data continue to soften. Broad-based dollar weakness is likely to continue this week, and EM currencies should once again take advantage of this. That said, we continue to see divergences. TRY and BRL are likely to continue underperforming, while the Asian currencies should continue to outperform due to strong fundamentals. Continue reading “EM Preview for the Week Ahead”

Bank of England Preview

The Bank of England wraps up its meeting tomorrow. It is widely expected to remain on hold whilst likely setting the table for further easing by year-end. Below is a list of what the BOE may or may not do. Continue reading “Bank of England Preview”

FOMC Preview

The two-day FOMC meeting starts today and wraps up Wednesday afternoon. While no policy changes are expected, we highlight what the Fed may or may not do. We expect a dovish hold that should weigh on the dollar, with Powell underscoring the ultra-dovish message he sent at Jackson Hole. Continue reading “FOMC Preview”

Recent Euro Moves Far From Brutal

Many at the ECB continue to jawbone the euro. While this may help slow the single currency’s gains, we believe it will have limited lasting impact as the fundamentals favor a stronger euro over the near-term. Furthermore, we do not think that the scale of those gains warrant a panicked response from policymakers just yet. Continue reading “Recent Euro Moves Far From Brutal”

Drivers for the Week Ahead

  • Downward pressure on the dollar is likely to resume this week; FOMC meeting Wednesday will be very important
  • US data highlight will be August retail sales Wednesday; Fed manufacturing surveys for September will start to roll out; Canada has a busy week
  • UK has a busy week; BOE meets Thursday and is expected to deliver a dovish hold; UK-EU tensions are through the roof
  • Japan has an eventful week; BOJ meets Thursday and is expected to remain on hold; RBA minutes will be released Tuesday Continue reading “Drivers for the Week Ahead”

EM Preview for the Week Ahead

EM currencies were mixed last week as the dollar got some traction against the major currencies. We think the dollar is likely to come under broad-based pressure this week as the FOMC is likely to re-emphasize its ultra-dovish stance established at Jackson Hole. EM FX should benefit but divergences should continue. US data is also likely to continue sequentially weakening. Continue reading “EM Preview for the Week Ahead”

ECB Preview

The ECB meets tomorrow and is widely expected to stand pat. Macro forecasts may be tweaked modestly and there are some risks of jawboning against the stronger euro, but it should otherwise be an uneventful meeting. Looking ahead, a lot of room remains for further ECB actions. We expect the ECB to increase QE at the December 10 meeting. However, another rate cut seems very unlikely, as does activation of OMT. Continue reading “ECB Preview”