FX Markets Weekly Wrap Dollar bounces back; disinflation points to sterling peak The US dollar has rebounded over the past two days and looks set to unwind much of last week’s fall. With US data somewhat mixed, much of this rebound in the greenback seems to have been driven by a... 21st July 2023 · 7 mins read
Capital Daily JPY & MXN: trading places We expect the fortunes of the Japanese yen and Mexican peso – which have both been outliers in different ways lately – to soon reverse, as souring risk appetite unwinds some “carry trade” and their... 21st July 2023 · 4 mins read
FX Markets Update Taking stock of our forecast for a stronger dollar While recent data suggest the US in on a path towards disinflation and a less aggressive monetary policy stance from the Fed, we continue to think that the dollar will rebound in the second half of... 21st July 2023 · 4 mins read
FX Markets Valuations Monitor FX Valuations Monitor (2023 Q3) While the US dollar has fallen against most currencies since the start of the year, our estimates of the greenback’s “fair value” are broadly unchanged, leaving it only somewhat overvalued in our... 21st July 2023 · 1 min read
Latin America Economics Update Is a stronger peso harming Mexico’s economy? Mexico’s exports have fared well recently and the current account deficit remains small. But a closer look suggests that the strength of the peso is causing dynamics in the balance of payments to... 20th July 2023 · 4 mins read
Global Markets Update Why Gilt yields and sterling may have further to fall Despite today’s big reaction in markets in the UK to better-than-expected inflation news, we still think investors are overestimating the peak in interest rates there and underestimating how much... 19th July 2023 · 5 mins read
Capital Daily Market optimism may have gone too far All is well in the US economy – at least according to financial markets. But we think investors are underestimating the chance of an economic slowdown. 18th July 2023 · 3 mins read
FX Markets Weekly Wrap Soft landing optimism has the dollar on the ropes In the wake of last week’s solid US payrolls report and this week’s below-expectation CPI data, which have strengthened hopes of a “soft-landing” in the US economy, short-term momentum has swung... 14th July 2023 · 6 mins read
Capital Daily Are other markets right to ignore oil’s rally? Equity, bond, and FX investors seem to have shrugged off the recent rise in oil prices. We wouldn’t be surprised if that continued even if prices rose further. 14th July 2023 · 6 mins read
FX Markets Update The EM “carry trade” looks increasingly stretched Emerging markets (EM) currencies with high short-term yields – i.e., high “carry” – remain the strongest currencies against the US dollar this year, even if their gains over the past week have been... 14th July 2023 · 4 mins read
Global Markets Update How markets might fare as US disinflation continues June’s soft US CPI print seems to have given investors renewed hope that inflation could fall back to normal levels without the economy slowing too much, if at all. We continue to think that the... 13th July 2023 · 3 mins read
Capital Daily Investors are getting the yen right for the wrong reasons Renewed murmurs of additional tweaks to the Bank of Japan’s (BoJ) Yield Curve Control (YCC) policy are giving further impetus to the yen’s recent rally. Though we forecast the yen to strengthen... 13th July 2023 · 4 mins read
Middle East & North Africa Economics Weekly Egypt privatisations, Dubai real estate A round of state asset sales announced in Egypt this week suggests that there is fresh impetus behind the privatisation drive and that the government is pushing to get the IMF deal back on track. But... 13th July 2023 · 7 mins read
Global Markets Update Why don’t TIPS yields matter anymore? Not so long ago, a higher 10-year TIPS yield almost invariably meant an underperformance of US “growth” stocks vis-à-vis their “value” peers, a lower gold price, and a stronger dollar. That’s changed... 13th July 2023 · 5 mins read
Capital Daily Labour market data send markets there and back again Signs the US labour market is beginning to loosen support our view that bond yields and equities could fall further, while the greenback could rally. 7th July 2023 · 5 mins read
FX Markets Weekly Wrap Payrolls & intervention chatter shuffle the currency deck again While the US dollar has dropped back in the wake of today’s non-farm payrolls report, continuing its recent struggles, two other trends in currency markets are showing some signs of exhaustion. Most... 7th July 2023 · 7 mins read
