Will June be September

23 May, 2016

The significance of today’s G7 meeting in Japan has been falling in importance in line with the weakening yen. Back on 3rd May, when USDJPY was down at 106, it was thought that Japan would be looking to re-align the currency and perhaps looking for some support from their G7 counterparts, but that was always going to be a long-shot, not least because there are few who are looking or hoping for a stronger currency at this point in time. So expect some anodyne statement in relation to currencies, indeed if there is any reference to them at all. The dollar is ending what will be its third consecutive week of gains on the dollar index, with the June FOMC meeting now back in the frame as a ‘live’ meeting for a rate hike. The question is whether June is going to turn out to be September, meaning September last year when the whole world and their wife were looking for a Fed move that never arrived that month. It’s going to be the activity and price data that determines that.

In the UK, according to the FT, bookmakers have been cutting the odds of a Brexit, even though the polls continue to show only a narrow lead for the ‘remain’ campaign. Sterling was at 3.5 month highs vs. the EUR yesterday, with Brexit weighing less heavily on the currency than was the case earlier in the year. The firmer than expected retail sales data was also supportive, with the revisions suggesting we may see an upward revision to first quarter GDP. For today, the interest is mostly with Canada, where CPI data is released at 12:30 GMT. After Australia’s easing earlier this month, in the dollar bloc, the focus is on both Canada and New Zealand as those most likely to move rates next. New Zealand looks likely early next month. Canada looks less assured, but still possible for later this year.


Source link  
Risk-On or Risk-Off?

The rhetoric continues between North Korea and the United States with North Korea’s Foreign Minister, Ri Yong Ho, describing President Trump’s recent comments as “tantamount...

German & New Zealand Elections

The results of the German Election have re-elected Chancellor Angela Merkel for a fourth term. Her CDU party won fewer votes than was expected and Chancellor Merkel...

Fed Holds Rates for Now But...

Unsurprisingly, the Federal Reserve kept rates on hold following the end of its 2-day meeting on Wednesday. They did, however, indicate that...


UK Unemployment at 42 Year Low

UK unemployment fell to its lowest level since 1975, data on Wednesday revealed. Unemployment fell by 75K, bringing the unemployment...

US Equities at Record Levels

US equities closed at record levels on Wednesday, as improved risk-on sentiment returned to the markets and news that the US economy...

USD Stabilizes

Hurricane Irma has, reportedly, inflicted less damage on the US mainland than was originally predicted, thereby reducing the economic impact of the devastation it was expected to...


Markets on Edge

With the markets risk appetite dampened after North Korea’s most powerful nuclear test to date, USD and Global equities fell whilst Gold, Yen and Sovereign Bonds all rose....

Risk Appetite Returns

North Korea official news agency reported on Monday that leader Kim Jong Un will watch the actions of the United States for a while longer before making a decision to fire missiles at Guam...

US-Korean Tensions Rattle Markets

Markets were cautious on Wednesday, as safe-haven assets pushed higher after tensions grew between the US and North Korea. Markets are concerned...

  


Share: