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Jobs Data Keeps Fed on Track to Hike

December 04, 2015
After the ECB's disappointment yesterday market nerves were shattered, but the largely as expected US jobs data may help the focus return to the underlying fundamental fact. The ECB just eased policy.  Not as much as the market expected, and that speaks to market positioning, but it did ease.  And the 211k increase in November jobs, with the O…
Jobs Data Keeps Fed on Track to Hike Jobs Data Keeps Fed on Track to Hike Reviewed by Marc Chandler on December 04, 2015 Rating: 5
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From the ECB's Failure to Communicate to US Jobs to Confirm Fed Signals

December 04, 2015
The only way to explain the largest swing in the euro in six years yesterday is to appreciate the disconnect between what was expected and what was delivered by the ECB. Draghi's urgency and commitment to do "what it must" fanned expectations, and more importantly, substantial positions, in various asset classes--short euros, long Eu…
From the ECB's Failure to Communicate to US Jobs to Confirm Fed Signals From the ECB's Failure to Communicate to US Jobs to Confirm Fed Signals Reviewed by Marc Chandler on December 04, 2015 Rating: 5
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ECB Fireworks

December 03, 2015
Market participants knew that volatility would rise today with the ECB meeting. What they got was far worse than could have been anticipated.  
It started with a report on the Financial Times a few minutes before the ECB's official announcement claiming, disappointingly, that there was no rate cut. The euro took off, spiking to almost $1.07 fro…
ECB Fireworks ECB Fireworks Reviewed by Marc Chandler on December 03, 2015 Rating: 5
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Draghi's Day to Deliver

December 03, 2015
The much anticipated ECB meeting is at hand.  Yesterday's disappointing eurozone CPI figures only fanned the anticipation. Today the service PMI was softer than expected at 54.2, down from 54.6.  

What will Draghi do? There are four moving parts.  

The first is the deposit rate, which currently stands at -20 bp. When first adopted in September 2…
Draghi's Day to Deliver Draghi's Day to Deliver Reviewed by Marc Chandler on December 03, 2015 Rating: 5
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Is Grexit Back on the Table?

December 02, 2015
Defying the expectations a few months ago, Greece remained in the Economic and Monetary Union.  It recently succeeded in implementing sufficient reforms to earn another tranche of aid.   However, the entire exercise exhausted whatever trust there may have been.  It has also further soured Greece's attitude toward the EU. This leaves officials …
Is Grexit Back on the Table? Is Grexit Back on the Table?  Reviewed by Marc Chandler on December 02, 2015 Rating: 5
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The Wait is Nearly Over, and the Dollar Catches a Bid

December 02, 2015
The anticipation is nearly over.  The softer than expected preliminary EMU inflation figures encourages expectations for the more aggressive range of actions by the ECB tomorrow.  Draghi has claimed that movement toward the inflation target was too slow.  Today's data showed a 0.1% increase year-over-year in the headline rate.  The market had …
The Wait is Nearly Over, and the Dollar Catches a Bid The Wait is Nearly Over, and the Dollar Catches a Bid Reviewed by Marc Chandler on December 02, 2015 Rating: 5
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Great Graphic: Canadian Growth and Rate Expectations

December 01, 2015
Canada reported its monthly GDP estimate for September, and at the same time, provided its first estimate of Q3 GDP.   The Great Graphic, created on Bloomberg, shows both time series.
The monthly GDP is depicted by the yellow line and the quarterly estimate is the white line.  Clearly they track each other, as one would expected.   The good news is…
Great Graphic: Canadian Growth and Rate Expectations Great Graphic:  Canadian Growth and Rate Expectations Reviewed by Marc Chandler on December 01, 2015 Rating: 5
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China, the SDR, and Toward a Less Euro-Centric World

December 01, 2015
(Here is a draft of a monthly column I write for a Chinese paper)
It is official.  The Chinese yuan will be in the SDR.  At a 10.4% share, it is a bit more than I expected, but less than the 14%-16% share that the IMF staff has intimated a few months ago.  This is a significant event, even if there is no short-term market opportunity.  
The yuan’s e…
China, the SDR, and Toward a Less Euro-Centric World China, the SDR, and Toward a Less Euro-Centric World Reviewed by Marc Chandler on December 01, 2015 Rating: 5
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Dollar Trades Heavier, Key Events Awaited

December 01, 2015
The US dollar is trading with a heavier bias today amid some last minute position squaring ahead of the key events of the week, which are stacked in the second half. The ECB meeting and US jobs data are the two most important events in a jam packed week for most participants.  
The recent pattern has been for new lows in the euro to be greeted with…
Dollar Trades Heavier, Key Events Awaited Dollar Trades Heavier, Key Events Awaited Reviewed by Marc Chandler on December 01, 2015 Rating: 5
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