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May Flies, but June Bugs

May 31, 2015
It is not that May did not have its challenges.  The German bund extended flash crash had knock-on effects throughout the capital markets. The dollar, which had been trending lower since mid-March, staged an impressive rally in the second half of May that completely unwound the weakness in the first half of the month, and carried it to new multi-y…
May Flies, but June Bugs May Flies, but June Bugs Reviewed by Marc Chandler on May 31, 2015 Rating: 5
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Dollar Bulls may Pause

May 30, 2015
The US dollar's strong advance in the second half of May showed signs of tiring as last week drew to a close.  It could be a function of month end flows, but the magnitude of the dollar's advance and the near-term event risk will likely encourage more defensive activity.  
Next week's calendar is chock full of events, including RBA, ECB…
Dollar Bulls may Pause Dollar Bulls may Pause Reviewed by Marc Chandler on May 30, 2015 Rating: 5
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Emerging Markets: What has Changed

May 29, 2015
(from my colleagues Dr. Win Thin and Ilan Solot)

1) Brazil’s Senate finally approved the much discussed fiscal measure  2) Poland’s ruling party lost control of the presidency 3) The conflict in the South China Sea is heating up again 4) The key JPY/KRW cross has fallen to its lowest level since early 2008 5) Russia and Venezuela signed a $14 bln inves…
Emerging Markets: What has Changed Emerging Markets:  What has Changed Reviewed by Marc Chandler on May 29, 2015 Rating: 5
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Italy holds Regional and Local Elections this Weekend

May 29, 2015
There is a specter haunting Europe. It is a specter that rejects the status quo. Last weekend, Spain's ruling PP lost majorities in all key municipalities and regional governments.  The opposition itself is fragmented, and nine of the ten major municipalities will be run by what appears to be loose coalitions. One wag said that it was as if Sp…
Italy holds Regional and Local Elections this Weekend Italy holds Regional and Local Elections this Weekend Reviewed by Marc Chandler on May 29, 2015 Rating: 5
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Marking Time Ahead of US GDP

May 29, 2015
Anticipation of a sharp downward revision in Q1 US GDP has seen the dollar's gains trimmed a bit, though it has gained against all the major currencies this week.  Rather than expand in the first three months of the year, the world's largest economy likely contracted.  The debate is over how much it contracted its significance.  
The 0.2% g…
Marking Time Ahead of US GDP Marking Time Ahead of US GDP Reviewed by Marc Chandler on May 29, 2015 Rating: 5
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Great Graphic: When Sterling Becomes the Pound

May 28, 2015
Sterling has fallen out of favor.  It was the market's darling, rallying from $1.4565 in mid-April to $1.5815 in mid-May.  From a technical point of view it was correcting the slide from last July's test on $1.7200.  The fundamental trigger for the correction was the weaker US dollar environment, which was partly spurred by disappointing Q…
Great Graphic: When Sterling Becomes the Pound Great Graphic:  When Sterling Becomes the Pound Reviewed by Marc Chandler on May 28, 2015 Rating: 5
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Great Graphic: Institutional Capacity Building in EMU

May 28, 2015
The pre-Socratic Heraclitus was the philosopher of  change.  He wrote that "no man steps in the same river twice; for it is not the same river and he is not the same man."  Truth that. 
We are well aware of the congenital defects of the European Monetary Union.  Who is not?   It is not so dissimilar from the US experience.  When the US wa…
Great Graphic: Institutional Capacity Building in EMU Great Graphic:  Institutional Capacity Building in EMU Reviewed by Marc Chandler on May 28, 2015 Rating: 5
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Dollar Turns Mixed, Chinese Shares Tumble

May 28, 2015
The US dollar is mixed after making new multi-year highs against the yen near JPY124.30 in Asia, while month-end positioning appears to have helped fuel an extension of the euro's recovery that began in the North America yesterday.  The lack of an upward revision to UK Q1 GDP kept sterling's upside correction muted.  
There are two main tal…
Dollar Turns Mixed, Chinese Shares Tumble Dollar Turns Mixed, Chinese Shares Tumble Reviewed by Marc Chandler on May 28, 2015 Rating: 5
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Dollar Extends Gains Against the Yen

May 27, 2015
The US dollar had been in a broad trading range against the yen since last December. The marginal new high seen in March to about JPY122 proved to be a false break, and the dollar returned to its well worn ranges. After testing the lower end of an even narrower range around near JPY119 on May 14, the greenback has rallied about 4% to approach JPY…
Dollar Extends Gains Against the Yen Dollar Extends Gains Against the Yen Reviewed by Marc Chandler on May 27, 2015 Rating: 5
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