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China Strikes Back

August 05, 2019
Overview: Chinese officials took the US tariff hike quietly last week but struck back today.  The PBOC fixed the dollar higher (CNY6.90), which it has not done, and will halt imports of US agriculture. The dollar shot through CNY7.0 to finish the mainland session a little above CNY7.03 and CNH7.07 for the offshore yuan.  This has sent ripple effec…
China Strikes Back China Strikes Back Reviewed by Marc Chandler on August 05, 2019 Rating: 5
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Trump's Tariffs Did What Fed Couldn't: Start a Dollar Correction

August 04, 2019
We look for patterns in macroeconomic data and prices.  We have a sense of deja vu.  A period of trade calm, the US uses tariffs to force China to do something.  Stocks go down.  Interest rates fall as does the dollar.  A truce is declared, leaving tariffs at higher levels and equities recover, the dollar firms and interest rates stabilize.  We ha…
Trump's Tariffs Did What Fed Couldn't: Start a Dollar Correction Trump's Tariffs Did What Fed Couldn't: Start a Dollar Correction Reviewed by Marc Chandler on August 04, 2019 Rating: 5
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The Dog Days of August are Upon Us

August 03, 2019
The die is cast. To defend the uneven expansion and ward off disinflationary forces, monetary authorities will provide more accommodation.  The Federal Reserve delivered its first rate cut in more than a decade and stopped unwinding its balance sheet two months earlier than it previously indicated (worth $100 bln of additional buying of Treasuries…
The Dog Days of August are Upon Us The Dog Days of August are Upon Us Reviewed by Marc Chandler on August 03, 2019 Rating: 5
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Cool Video: CNBC Asia and Thoughts on CNY/CNH and JPY

August 02, 2019
A few hours after President Trump tweeted the end of another tariff truce with China, I had the privilege of talking with CNBC's Asia anchors Mary Hungerford and Sri Jegarajah on the outlook for the yuan and yen.The 2.45-minute video clip can be found here.
The new tariffs on China will likely further reduce its exports and act as a headwind o…
Cool Video: CNBC Asia and Thoughts on CNY/CNH and JPY Cool Video: CNBC Asia and Thoughts on CNY/CNH and JPY Reviewed by Marc Chandler on August 02, 2019 Rating: 5
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End of Tariff Truce Trumps Jobs

August 02, 2019
Overview:  The market was finding its sea legs after being hit with wave and counter-wave following the FOMC decision, and more importantly, Powell's attempt to give insight into the Fed's thinking.  Trump's tweet than signaled an end to the tariff truce with a 10% levy on the $300 bln of imports from China that have not been subject t…
End of Tariff Truce Trumps Jobs End of Tariff Truce Trumps Jobs Reviewed by Marc Chandler on August 02, 2019 Rating: 5
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August Monthly

August 01, 2019
After falling against all the major currencies in June, the US dollar rebounded in July.  The Dollar Index finished the month at new two-year highs with the Fed’s suggestion it was engaged in a mid-course correction rather than a sustained easing cycle.  The dollar also appeared buoyed by the extent of the dovishness by the ECB and the heightened …
August Monthly August Monthly Reviewed by Marc Chandler on August 01, 2019 Rating: 5
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Mid-Course Correction Sends Greenback Higher

August 01, 2019
Overview:  The Federal Reserve delivered the first rate cut since the Great Financial Crisis but couched it in terms of a mid-course correction rather than the start of a larger easing cycle.  By doing so, Fed chief Powell cast the cut in less dovish terms than the market expected and the reaction function of the market has been clear.  The US dol…
Mid-Course Correction Sends Greenback Higher Mid-Course Correction Sends Greenback Higher Reviewed by Marc Chandler on August 01, 2019 Rating: 5
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