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Sterling Bounces Two Cents, but Does not Appear Sustainable

July 07, 2016
Amid a better if not strong risk appetite, sterling has rallied two cents from yesterday's lows near $1.28 to poke through the $1.30 level in the European morning. It was helped by an industrial production report that was better than expected.  Industrial and manufacturing output fell 0.5% in May.  This was around half of the expected decline …
Sterling Bounces Two Cents, but Does not Appear Sustainable Sterling Bounces Two Cents, but Does not Appear Sustainable Reviewed by Marc Chandler on July 07, 2016 Rating: 5
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Great Graphic: The Yuan's Weakness

July 06, 2016
Here are two Great Graphics that portray two time series: the dollar-yuan exchange rate and the yuan against a trade-weighted basket. 

 The first chart comes from a highly reputable consulting firm. It replicates the trade-weighted basket that Chinese officials unveiled and shows how it would have performed in the past.
The second chart is from B…
Great Graphic: The Yuan's Weakness Great Graphic: The Yuan's Weakness Reviewed by Marc Chandler on July 06, 2016 Rating: 5
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Return of the Repressed: Europe's Unresolved Banking Crisis

July 06, 2016
The conventional narrative has it backward. It worries about the threats to stability emanating from the periphery in Europe.  Policymakers, investors, and economists still refer to the "Greek, Irish, Portugal and Cyprus' bailouts.   
The biggest threats don't come from the periphery but the core. The peripheral countries were not bail…
Return of the Repressed: Europe's Unresolved Banking Crisis Return of the Repressed: Europe's Unresolved Banking Crisis Reviewed by Marc Chandler on July 06, 2016 Rating: 5
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Dollar and Yen Advance Amid Growing Investor Angst

July 06, 2016
What a difference a few days make.  Many saw last week's equity market advance a sign that Brexit anxiety was overdone. However, quarter-end position adjustments appear to have been misread.  Equity markets are falling now. Bond yields in the US, Japan, and Germany, are at new record low.  Japan's 20-year bond yield briefly dipped below ze…
Dollar and Yen Advance Amid Growing Investor Angst Dollar and Yen Advance Amid Growing Investor Angst Reviewed by Marc Chandler on July 06, 2016 Rating: 5
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Is Carney the Sole Adult in UK's Political Morass?

July 05, 2016
Sterling is continuing to move lower. It has tested the $1.3050 area in the North American morning, having been under pressure through the Asian session and the European morning.  That the UK economy is slowing down, materially, as BOE Governor Carney said, is not really new news. Nor is the fact that the BOE reversed its previous decision to forc…
Is Carney the Sole Adult in UK's Political Morass? Is Carney the Sole Adult in UK's Political Morass? Reviewed by Marc Chandler on July 05, 2016 Rating: 5
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Sterling Hammered to New Lows, Yen Pops

July 05, 2016
The British pound has been hammered to fresh lows just above $1.3115. The euro is moving toward GBP0.8500.  The immediate catalyst is three-fold.  First, one of the UK's largest property funds has moved to prevent retail liquidation. Second, the BOE reversed an earlier decision on the capital buffer for banks, which is tantamount to easing pol…
Sterling Hammered to New Lows, Yen Pops Sterling Hammered to New Lows, Yen Pops Reviewed by Marc Chandler on July 05, 2016 Rating: 5
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Four Things that Happened on the Anniversary of the Original Brexit

July 04, 2016
Monday, while Americans were celebrating the original Brexit, the US dollar drifted lower. The Australian dollar fully recovered from electoral uncertainty drop to finish about 0.5% higher.  Asian and emerging market equities rallied, but Europe faltered.
The MSCI Asia-Pacific Index gained 0.8% to extend the advancing streak to a fourth session. MS…
Four Things that Happened on the Anniversary of the Original Brexit Four Things that Happened on the Anniversary of the Original Brexit Reviewed by Marc Chandler on July 04, 2016 Rating: 5
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