Tantrum “lite” won’t help US Dollar
US financial markets have had to contend with three “hawkish surprises” so far this month and on each occasion price action has been broadly the same. Initially the Dollar rallied, the S&P 500 sold off and US Treasury yields rose but these (modest) moves were very quickly r… Become a member to read the […]
CHINA: Crypto crackdown – is this time different?
Three government-backed industry associations ordered financial institutions not to facilitate virtual currency transactions or provide any related services. But the impact is likely to be modest, as the latest crackdown does not go substantially beyond a previous ban in 2017 … Become a member to read the rest of this article
US markets playing along to Fed tune…for now
Treasury Secretary Yellen’s comments ten days ago were merely a temporary distraction. Perhaps more surprisingly, at first glance, the release on Wednesday of a much larger-than-expected increase in US CPI-inflation in April has not had much “sticking power”. Core CPI-… Become a member to read the rest of this article
Turkey: Ankara bans payments in cryptocurrencies
Turkey will bar consumers and businesses from exchanging payment for goods and services in Bitcoin and other cryptocurrencies. In legislation (six articles) published in the Official Gazette overnight, the Central Bank of Turkey (TCMB) determined that cryptocurrencies and other s… Become a member to read the rest of this article
Crunch time for Singapore Dollar and Renminbi
We estimate that the USD-value of central bank FX reserves – adjusted for currency-valuation effects – in China, India, Indonesia, Korea, Malaysia, Philippines, Singapore, Taiwan and Thailand rose by about $342bn (1.5% of GDP) between end-March 2020 and end-February 2021 (see Non… Become a member to read the rest of this article
Non-Japan Asia: NEERs and FX intervention
Non-Japan Asian (NJA) central banks’ foreign currency (FX) reserves have gradually increased since end-March 2020, arguably the peak in global risk aversion. We estimate that the aggregate US Dollar-value of FX reserves in China, India, Indonesia, Korea, Malaysia, Philippines,… Become a member to read the rest of this article
CHINA: Signs of disagreement over monetary tightening and housing bubble risks
There are signs of disagreement among policymakers about how much to tighten monetary policy, with an influential voice warning that excessive tightening could trigger a sharp drop in housing prices. The proper role of monetary policy in restraining housing speculation has… Become a member to read the rest of this article
TURKEY: Policy continuity (for now)
The Turkish authorities are busy seeking to reassure investors after the unexpected change of leadership at the top of the Central Bank (TCMB). Yesterday (21 March), the newly appointed Governor Sahap Kavcioglu indicated that the fight against inflation remains a priority and, cr… Become a member to read the rest of this article
EM currencies: Central bank friends and foes
The Fed updated “dot-chart” of all FOMC members’ expectations of the appropriate policy rate points to only an incrementally less dovish stance. Based on a weighted average FOMC members still only expect one 25bp hike by end-2023, according to our estimates. Fed seems eager to c… Become a member to read the rest of […]
Update On My Recommended Trades
Recommended Open And Closed Trades I have not put out an update since the beginning of the year won my recommended trades so, I thought it was about time. So here goes. I am currently positioning for three themes: Exponential Rebound in US Economic Growth I am positioning for… Become a member to read […]