Results for Foreign Exchange Market
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Capital Flows Outstrip Trade Flows and that is Where to Look for Drivers of FX Capital Flows Outstrip Trade Flows and that is Where to Look for Drivers of FX Reviewed by Marc Chandler on November 12, 2022 Rating: 5
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December Monthly

December 02, 2019
November was really about consolidation in the foreign exchange market.  Recall that the US dollar had fallen against nearly all the major currencies in October.  It recovered in November.  No new themes emerged.  The drivers remained the vagaries of the US-China trade talks, the build-up to the UK election in the middle of December, which is bei…
December Monthly December Monthly Reviewed by Marc Chandler on December 02, 2019 Rating: 5
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Global Governance in a Non-G-Zero World

December 24, 2013
There is an intellectual fashion that has been inspired by the past decade in which there has been some convergence between the GDP per capita of emerging markets and those of the developed countries.  After diverging from 1950 to around 2000,  the out-performance of emerging markets over the past decade has nearly unwound growing disparity of sec…
Global Governance in a Non-G-Zero World Global Governance in a Non-G-Zero World Reviewed by Marc Chandler on December 24, 2013 Rating: 5
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China Pulls Rug Further on Bitcoins

December 18, 2013
Even in this age of globalization, the sovereign retains a monopoly on two things:  the legitimate use of force and the power of coinage.  The rise of the bitcoin, and digital currencies general, pose a challenge to this monopoly and bitcoin advocates recognize this.

While many also realize that these are still early days for the evolution of digi…
China Pulls Rug Further on Bitcoins China Pulls Rug Further on Bitcoins Reviewed by Marc Chandler on December 18, 2013 Rating: 5
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Great Graphic: FX Turnover

September 13, 2013
The Economist drew from the latest survey of the Bank of International Settlements to create this Great Graphic that shows the average daily turnover of the top 16 currencies. 
Average daily turnover is a mind-numbing $5.3 trillion.  In three days foreign exchange turnover is sufficient to cover world trade in a year.
The BIS conducts the survey …
Great Graphic: FX Turnover Great Graphic: FX Turnover Reviewed by Marc Chandler on September 13, 2013 Rating: 5
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Currency Wars: Causes and Consequences

January 23, 2013
The Realist understanding of international affairs is that it is a realm of competition.  The competition is multi-faceted, taking place in politics and economics.  It has a cultural dimension.  It takes place even in the writing of history.  
This competition spills over into the foreign exchange market.  It did not begin with the unorthodox pursu…
Currency Wars: Causes and Consequences Currency Wars: Causes and Consequences Reviewed by Marc Chandler on January 23, 2013 Rating: 5
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Euro Winds Down

December 28, 2012
The relatively calm foreign exchange market and equity market in Asia ended abruptly in Europe.  It is difficult to find the culprit, other than position squaring in thin markets, but the euro has come off a cent, dragging the franc.  
The MSCI Asia Pacific Index gained more than 0.5%, while European bourses are broadly lower, with the Dow Jones …
Euro Winds Down Euro Winds Down Reviewed by Marc Chandler on December 28, 2012 Rating: 5
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Storm Clouds Continue to Gather

November 13, 2012
The euro was sold to new two-month lows against the dollar following the failure of the euro area finance ministers show any progress toward an agreement on Greece or bank supervision.
News of a worse than expected German ZEW survey (expectations -15.7 vs -9.8 expected and -11.5 in September) saw the low put in.  However, news that Greece was able…
Storm Clouds Continue to Gather Storm Clouds Continue to Gather Reviewed by Marc Chandler on November 13, 2012 Rating: 5
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Brief Thoughts on the Price Action

November 06, 2012
Turnaround Tuesday was not all that convincing.  The correction really took on more of the appearance of consolidation.   Renewed dollar gains look likely, regardless of the electoral results, which are still not known at this juncture.  
The lifting of the event risk posed by the election is likely to be over shortly and this is good news for in…
Brief Thoughts on the Price Action Brief Thoughts on the Price Action Reviewed by Marc Chandler on November 06, 2012 Rating: 5
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Bernanke Fires Salvo in Response to Currency War Claims

October 15, 2012
The Federal Reserve's open-end asset purchase plan (QE3+) is controversial.  Bernanke has defended its action against the domestic critics.  Over the weekend he defended QE3+ against foreign critics.      

Some in the emerging markets, most notably Brazil's finance minister, has claimed the unorthodox easing by the Federal Reserve in parti…
Bernanke Fires Salvo in Response to Currency War Claims Bernanke Fires Salvo in Response to Currency War Claims Reviewed by Marc Chandler on October 15, 2012 Rating: 5
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FX Positioning and Technical Outlook: What is Working

October 13, 2012
Market participants have to confront a stark asymmetry.  There are many ways to lose money, but there appears to be only three ways to make money. Nearly all strategies seem to come down to some variant of momentum or trend following, mean reversion, and carry trades.
Each is associated with different market conditions and require different behavi…
FX Positioning and Technical Outlook: What is Working FX Positioning and Technical Outlook: What is Working Reviewed by Marc Chandler on October 13, 2012 Rating: 5
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Great Graphic: Central Bank Balance Sheets

October 07, 2012
This Great Graphic comes from Also Sprach Analyst blog.   It depicts the balance sheets of the Federal Reserve, Bank of England, European Central Bank and the Bank of Japan.  
What will surprise many is that the Fed's balance sheet has shrunk for nearly a year and, as a percentage of GDP, its balance sheet is not as large as the other major co…
Great Graphic: Central Bank Balance Sheets Great Graphic: Central Bank Balance Sheets Reviewed by Marc Chandler on October 07, 2012 Rating: 5
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Sterling's Resilience: Agriculture Subsidies?

September 26, 2012
Sterling has been resilient.  At the end of last week, sterling traded at new highs for the year against the dollar, briefly pushing through the $1.63 level.  It is trading about 2% above the multi-year high recorded against the euro in late July.  On the BOE's broad trade-weighted measure, sterling has appreciated about 4% this year.  This pe…
Sterling's Resilience: Agriculture Subsidies? Sterling's Resilience: Agriculture Subsidies? Reviewed by Marc Chandler on September 26, 2012 Rating: 5
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FOMC: Gold, Dollar and the S&P 500

September 13, 2012
There are too many moving parts for the outcome of FOMC meeting to be a foregone conclusion. Since the disappointing August jobs report, the risk of a new round of asset purchases has increased and this has contributed to the risk-on environment, which of course has also been driven by the ECB. While this had led many to conclude the QE has been…
FOMC: Gold, Dollar and the S&P 500 FOMC: Gold, Dollar and the S&P 500 Reviewed by Marc Chandler on September 13, 2012 Rating: 5
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Eventful Week Begins Slowly

September 10, 2012
The US dollar is consolidating last week's losses in largely uneventful activity.  In fact, consolidation is the general theme in the broader capital markets as well.   Equity markets are narrowly mixed, with the MSCI Asia Pacific eking out a marginal gain and the Dow Jones Stoxx 600 trading with a slight downside bias in the European morning,…
Eventful Week Begins Slowly Eventful Week Begins Slowly Reviewed by Marc Chandler on September 10, 2012 Rating: 5
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FX Technical Outlook and Futures Positioning

August 25, 2012
There are two main drivers behind the price action in the foreign exchange market and they will likely persist in the days ahead.  First, there continues to be position adjustment ahead of the what promises to be eventful few weeks.  Second, the release of the minutes from the August 1 FOMC meeting has increased the perceived odds that QE3 is laun…
FX Technical Outlook and Futures Positioning FX Technical Outlook and Futures Positioning Reviewed by Marc Chandler on August 25, 2012 Rating: 5
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Fallout from Draghi: Do What is Necessary but Not Yet

August 02, 2012
Many observers seem dumbfounded by the lack of action to support official claims to do what is necessary.  The market's reaction has been swift.  European stocks reversed course.  Spanish stocks are off almost 4%, led by a 5% drop in financials.  Spain's (generic) 10-year bond yield is back above 7%.  
The fact that Draghi suggested that i…
Fallout from Draghi: Do What is Necessary but Not Yet Fallout from Draghi: Do What is Necessary but Not Yet Reviewed by Marc Chandler on August 02, 2012 Rating: 5
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Fed Reaction, but Draghi's Day

August 02, 2012
The US dollar has surrendered yesterday's post-FOMC gains as the market churns within recent ranges ahead of today's ECB meeting, the key event risk of the week.   The euro is back to levels seen near this time yesterday.   Stronger than expected Australian retail sales (1.4% vs 0.9% consensus) and an unexpected trade surplus (A$9 mln vs…
Fed Reaction, but Draghi's Day Fed Reaction, but Draghi's Day Reviewed by Marc Chandler on August 02, 2012 Rating: 5
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FX: Hurry Up and Wait

July 31, 2012
The US dollar is mixed. Against the dollar-bloc, it is soft, but against the other major currencies, it is consolidating in narrow ranges near the middle of yesterday’s ranges. Of the capital markets, the foreign exchange market seems the more wary of being disappointed this week. Risk assets, like equities, commodities and peripheral European …
FX: Hurry Up and Wait FX: Hurry Up and Wait Reviewed by Marc Chandler on July 31, 2012 Rating: 5
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What Nowotny Did Not Say

July 25, 2012
There seems to be some confusion in the markets.  Many think that the head of the Austrian central bank and ECB member Nowotny raised the likelihood that the ESM could get a banking license.  This would allow it to borrow from the ECB to supplement its funds and make for a practically unlimited war chest. 

It would help address concerns that the c…
What Nowotny Did Not Say What Nowotny Did Not Say Reviewed by Marc Chandler on July 25, 2012 Rating: 5
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