Pausing to Reflect

17 June, 2016

After the tragic events in the UK yesterday, there was a dramatic change in tone in the political environment with one week to go before the EU referendum. This was also reflected in markets, with campaigning on both sides having been suspended for the coming days. It’s a pause for reflection on what was a relentless push towards shedding risk in markets over the past week. For now, this has resulted in a sharp reversal in sterling, less so in other risk correlated assets such as the yen and Swiss franc. We’ll have to wait until Monday for the sand to settle enough to gauge the lasting change in sentiment towards the referendum.

Japan’s Finance Minister Aso upped the rhetoric on the yen overnight, pointing out “We have to monitor moves with a sense of urgency so that speculative moves won’t continue”. More pointedly, he continued “when needed, I’d like to take firm action in line with G7 and G20 agreements”. I talked yesterday about the increased helplessness of central bank and it also appears true of finance ministers, with the yen only marginally weaker on the back of his comments. US inflation data is seen later today, but the reversal in tone is likely to remain in place and investors are more likely ease into the end of the week before next week takes hold.


Source link  
Eyes on US Retail Sales

Friday May 12th will see the release of a set of crucial US data for April at 13:30 BST; retail sales, retail sales excluding autos, CPI and core CPI....

Fed Expected to Keep Rates Steady

It is reported that Fed Chair Yellen is not due to hold a press...

Will Q1 GDP Show a Recovery?

The UK and the Eurozone Markit Manufacturing PMI for April will be released today at 09:30 BST...


Will US Q1 GDP Growth Show a Slowdown

This will be the first US GDP figure reported after Trump took office...

USD Rallies

Last Friday US non-farm payrolls for March rose by only 98K, which was far below expectations of 180K, marking...

How Will FOMC Minutes Affect USD?

The dollar index hit a 3-week high of 100.59 yesterday. However, it pulled back after testing the near-term major resistance...


EUR/GBP Bulls Retreat Under Resistance

The European Central Bank president Draghi will make a speech at 15:30 BST today...

Second Scottish Referendum Hits GBP

Tuesday evening, March 28, the Scottish parliament has voted by 69 to 59, in favour of holding a second independence...

Brexit Flight: A Hard or Soft Landing?

UK Prime Minister Theresa May will trigger Article 50 of the Lisbon treaty on Wednesday March 29, starting the 2-year Brexit negotiation...

  


Share: