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Week Ahead: Thoughts on Greece, China and the US

June 28, 2015
The inexperienced Greek government lost its nerve. The brink was less than a week away, and it blinked.  It changed tactics at the last possible minute.  It took a reckless political gamble. 
The was still no agreement of course, but Prime Minister Tsipras was standing his ground. The differences between what Greece had offered and what the officia…
Week Ahead: Thoughts on Greece, China and the US Week Ahead:  Thoughts on Greece, China and the US Reviewed by Marc Chandler on June 28, 2015 Rating: 5
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Dollar Psychology ahead of Key Events in Greece and US Jobs Data

June 27, 2015
One way to understand technical analysis is that it is a window into market psychology.  Market psychology is always interesting, but it is especially fascinating ahead of key fundamental developments. Next week promises to be adoozy.  
There have been so many final offers and last chances in Greece's negotiations with its creditors that it is …
Dollar Psychology ahead of Key Events in Greece and US Jobs Data Dollar Psychology ahead of Key Events in Greece and US Jobs Data Reviewed by Marc Chandler on June 27, 2015 Rating: 5
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Emerging Markets: What has Changed

June 26, 2015
(from my colleague, Dr. Win Thin)
1) The Brazilian congress passed a new measure that will hurt the fiscal outlook 2) Brazil central bank kept the inflation target for 2017 the same at 4.5%, but narrowed the tolerance band to +/ 1.5 percentage points 3) Israel central bank has gotten less dovish 4) Nigeria central bank banned importers from ac…
Emerging Markets: What has Changed Emerging Markets:  What has Changed Reviewed by Marc Chandler on June 26, 2015 Rating: 5
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Great Graphic: More Unsolicited Advice from the IMF

June 26, 2015
The leadership at the Federal Reserve has consistently signaled its intention to lift rates this year. It is conditioned on the labor market continuing to absorb the slack, and provided the officials can be "reasonably confident" that the inflation target will be reached on a medium term.  
The IMF has argued against this.  It has suggest…
Great Graphic: More Unsolicited Advice from the IMF Great Graphic:  More Unsolicited Advice from the IMF Reviewed by Marc Chandler on June 26, 2015 Rating: 5
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The Calm Before the Storm?

June 26, 2015
The global capital markets remain subdued for the most part despite the fact that paralysis in Europe is bringing Greece to the very brink.There will be no agreement today, and the finance ministers will meet again tomorrow in what Merkel and Hollande have called a "decisive meeting."  The implicit threat is that if no agreement is reach…
The Calm Before the Storm? The Calm Before the Storm? Reviewed by Marc Chandler on June 26, 2015 Rating: 5
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Is the Market more Confident of BOE Rate Hike than Fed Move?

June 25, 2015
A week ago the UK reported a largest than expected rise in average weekly earnings for the three months through April.  The 2.7% rise is the highest in four years. 
It followed a revised 2.3% increase in March, which had originally been reported at 1.9%.  Recall that last June average weekly earnings had actually fallen by 0.2% on a three-month yea…
Is the Market more Confident of BOE Rate Hike than Fed Move? Is the Market more Confident of BOE Rate Hike than Fed Move? Reviewed by Marc Chandler on June 25, 2015 Rating: 5
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Time for Some Elbow Grease

June 25, 2015
Another make it or it break it deadline passes in Greek negotiations and the markets take it in stride.  Indeed, the relatively calm markets conceal the angst below the surface.  After nine Eurogroup meetings since the Syriza government was elected that failed to put any closure on the issue, it is little wonder that they failed the tenth time.  N…
Time for Some Elbow Grease Time for Some Elbow Grease Reviewed by Marc Chandler on June 25, 2015 Rating: 5
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Great Graphic: Central Banks Snap Up Treasuries

June 24, 2015
The Federal Reserve offers custodial services for foreign central banks.   Precisely which countries use these services is confidential as is who patronizes a commercial bank's services. 
There was a large draw down in the Treasuries the Fed holds for foreign officials beginning last September and running through mid-March.  During this period …
Great Graphic: Central Banks Snap Up Treasuries Great Graphic:  Central Banks Snap Up Treasuries Reviewed by Marc Chandler on June 24, 2015 Rating: 5
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Great Graphic: Are Euro and Bunds Decoupling?

June 24, 2015
Previously there was a good fit between the direction of German bund yields and the euro.  This Great Graphic from Bloomberg illustrates this.   However, recently the relationship appears to be loosening.  Consider that over the past week, the 10-year bund yield is up 3 bp and that is with today's 3 bp decline.  The euro has fallen 1.1% over t…
Great Graphic: Are Euro and Bunds Decoupling? Great Graphic:  Are Euro and Bunds Decoupling? Reviewed by Marc Chandler on June 24, 2015 Rating: 5
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