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Dollar Drivers

June 07, 2015
The most important driver of the dollar remains the de-synchronization of the monetary policy cycle. The early and more aggressive action by the US, and the institutional flexibility, leaves the Federal Reserve in a position to begin normalizing monetary policy several quarters at least ahead of the eurozone, the UK and Japan. Other countries, inc…
Dollar Drivers Dollar Drivers Reviewed by Marc Chandler on June 07, 2015 Rating: 5
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Dollar Outlook

June 06, 2015
The strong US employment data stopped the dollar's downside correction in its tracks. It offset the unwinding of the long German bund/short euro hedge that had sent the euro racing toward $1.14.   The Japanese yen and New Zealand dollar fell to new multi-year lows. 
The US job growth was the strongest in five months. It follows other data that …
Dollar Outlook Dollar Outlook Reviewed by Marc Chandler on June 06, 2015 Rating: 5
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Emerging Markets: What has Changed

June 05, 2015
(from my colleagues Dr. Win Thin and Ilan  Solot)
1) Political risk is rising in Colombia
2) Petrobras issued debt for the first time in six months
3) The Russian central bank suspended some FX auctions, stepping up measures to counter RUB strength
4) Tensions between Ukraine and Russia are escalating again
5) Hungary’s central bank has changed …
Emerging Markets: What has Changed Emerging Markets:  What has Changed Reviewed by Marc Chandler on June 05, 2015 Rating: 5
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Strong US Jobs Data Sends Greenback Higher

June 05, 2015
The US May jobs reported was stronger than expected.  Although it will not boost the chances of a Fed rate hike later this month, a September lift-off still seems like the most likely scenario. 
The US economy created  280k jobs in May after a revised 221k increase in April.  The April figure is 2k lower than the initial estimate, but the March job…
Strong US Jobs Data Sends Greenback Higher Strong US Jobs Data Sends Greenback Higher Reviewed by Marc Chandler on June 05, 2015 Rating: 5
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Dollar and Syriza Push Back

June 05, 2015
The euro is steady after pulling back from yesterday's high near $1.1380.  German bund yields are slightly firmer today, but also off the 1.00% level approached yesterday.  Against the other major currencies, the dollar is slightly firmer, as the participants turn cautious ahead of the US jobs data.  
The US employment report is typically among…
Dollar and Syriza Push Back Dollar and Syriza Push Back Reviewed by Marc Chandler on June 05, 2015 Rating: 5
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Great Graphic: Faith in EU is Stronger Than You Might Suspect

June 04, 2015
The media often depicts a European Union that is unraveling.  The financial crisis, high unemployment, and demands for austerity for as far as the eye can see have undermined confident in the European project.   Syriza and Podemos from the Left, and the likes of the National Front and the Northern League on the right, are squeezing the center in a…
Great Graphic: Faith in EU is Stronger Than You Might Suspect Great Graphic:  Faith in EU is Stronger Than You Might Suspect Reviewed by Marc Chandler on June 04, 2015 Rating: 5
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US is not Driving Dollar

June 04, 2015
The US dollar is sliding across the board, but the impetus is not coming from the United States.  If anything, the combination of the strong auto sales figures, smaller trade deficit, and ADP jobs estimate underscore the fact that the US economy is recovering from the Q1 contraction.  Rather the trigger for the dollar's broad retreat is the st…
US is not Driving Dollar US is not Driving Dollar Reviewed by Marc Chandler on June 04, 2015 Rating: 5
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Great Graphic: Bunds and Euro Tied at the Hip?

June 03, 2015
We have discussed this before, but show this Great Graphic again. The euro is tracking the movement in Germany bunds. The magnitude of the moves are different but the direction is clear. 
The unwind of long bund positions, and by extension, long European bond positions, is spurring stronger euro.  It is not a yield play.  Investors are not buying …
Great Graphic: Bunds and Euro Tied at the Hip? Great Graphic:  Bunds and Euro Tied at the Hip? Reviewed by Marc Chandler on June 03, 2015 Rating: 5
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ECB Cautiously Optimistic that Worst is Behind EMU

June 03, 2015
The substance of what ECB President Draghi contained few surprises.  The tone was cautiously optimistic that the worst is past for EMU.  
There were minor tweaks in the economy forecasts.  The growth estimate for this year and next were unchanged at 1.5% and 1.9% respectively. The forecasts for 2017 was shaved to 2% from 2.1%.  This year's infl…
ECB Cautiously Optimistic that Worst is Behind EMU ECB Cautiously Optimistic that Worst is Behind EMU Reviewed by Marc Chandler on June 03, 2015 Rating: 5
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