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Overview News that US tariffs on China will remain until through at least the November US election and continued US attempts to stymie China (e.g., more curbs on Huawei under consideration and stepped-up efforts to force it to cut subsidies to business) have taken some momentum from the push...
Overview The leaked US decision to lift the currency manipulator designation on China was the latest fodder fueling the new record highs in the S&P 500. The risk-taking appetite helped extend the rally in the MSCI Asia Pacific Index for the fourth consecutive session. Europe's Dow Jones ...
Overview There are two big stories today. The first is the large-scale protests in Iran after the government admits to accidentally shooting down the commercial airliner amid the fog of war. The market impact seems minimal but fueling speculation that this, coupled with the economic hardship...
The heightened geopolitical risks and then the unwind drove the price action in the capital markets last week, the first full week of the new year. These are the kind of markets that whipsaw even the most experienced and nimble among us. We review the recent price action and technical condit...
Overview: The first full week of 2020 is ending on a quiet note, pending the often volatile US jobs report. New record-high US equities on the back of easing geopolitical anxiety is a reflection of greater risk appetite that is evident across the capital markets. Asia Pacific equities mostly...
The US dollar is the world's reserve currency. Central banks around the world tend to hold the dollar as an integral part of their foreign currency reserves because of the long history of economy and political stability in the United States. The euro is a young currency as it only began tradin...
The EUR/AUD currency pair, which is the value of the euro expressed in terms of the Australian dollar, provides one with an interesting perspective with respect to global markets and risk sentiment. Because of the low rates offered in Europe (in fact, the deposit facility rate as set by th...
In the past cycle, many practitioners have questioned the ability of the ECB to raise inflation. Figure 1 (left frame) shows that the market-implied measure of inflation expectations, the 5Y5Y inflation swap, has constantly been declining in the past cycle and is currently sitting at 1.3%, far...
Overview: The S&P 500 recovered from a 10-day low to reach a new record high, which set the tone for the Asia-Pacific and European markets today. The MSCI Asia Pacific Index jumped by the most in a month with the Nikkei's 2% advance leading the way. More broadly, the markets in Taiwan, S...
Overview: The Iranian retaliatory missile strike on Iraqi bases housing US forces initially sparked a dramatic risk-off response throughout the capital markets. The muted response by the US coupled with signals from Tehran that it had "concluded" its proportionate measures saw the markets re...