Trump Trades

11 November, 2016

The story being seen in stocks markets and currency markets in the wake of the US Presidential election result is starting to diverge. Asian currencies have been under pressure, with the Korean won, Indian Rupee and Aussie dollar all weakening overnight. Recall that it was Asia that took an initial bearish view of developments on Wednesday before Europe came in and lifted things. Asia has more to lose from a more protectionist stance from the US administration. The US runs a trade deficit with both, but the Asian deficit is around 5 times that of Europe, hence the nerves. There have also been initial noises regarding NAFTA (the trade agreement between the US, Canada and Mexico), which Trump has threatened to re-negotiate or move. Both currencies (more so the Mexican peso) retain their weaker stance gained in the wake of the results.

Elsewhere, sterling is holding its head above water, cable above 1.25 and EURGBP moving below the 0.87 level, from above 0.90 earlier in the week. The policy backdrop continues to favour the pound, with the BoE not able to cut rates given the deteriorating inflation environment ahead. For today, there are no major data releases, so the continued settling of the dust in the wake of Tuesday’s events will remain the dominant theme.


Source link  
OPEC considers production cuts

Saudi Arabia, Russia and their oil-producing allies are considering a range of options to maintain stability in the oil market just weeks ahead...

More Brexit votes, pound volatility?

At the start of trading on Monday, the British pound fell 0.6%, as a crucial Saturday vote on the new Brexit plan was postponed. Prime Minister...

New Chinese stimulus promises

China continues to struggle for economic growth, as it aims to resist the effect of trade disputes with the U.S. The editor of an influential...


Best currency rally heading for a crash

The analyst who most accurately predicted the ruble's rally in the second quarter is now its most pessimistic forecaster. The Bank of Russia's switch to...

Trade truce 2.0, or new currency wars?

Tensions around trade wars subsided following news reports that both the US and China leaders are set to hold an extended meeting...

Experts predict where crude could go

A top military aide to Iran's supreme leader warned over the weekend that The first bullet fired in the Persian Gulf will push oil prices above...


Morgan Stanley sees global recession

Investors are overlooking the threat posed by the U.S.-China trade war, which could send the global economy into recession in less than a year...

Oil at $100: how will it affect economy?

Brent crude has risen about 33 percent this year and is close to the highest in six months. While higher prices due to strong demand typically reflects...

Oil sector will lose 95% by 2050

Companies in the oil and gas sector, including large groups such as Shell, BP and Exxon, could lose 95% of their value by 2050 if governments...

  


Share it on:   or