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FOMC Minutes Suggest Balance Sheet May Begin Shrinking This Year

April 05, 2017
The FOMC minutes were clear that officials are contemplating beginning address the balance sheet, which is another sign of confidence in the normalization process. However, beyond that very little else is clear.   There does not appear to be much agreement yet on the pace or the scope of the adjustment. 
There are roughly $425 bln of US Treasuries …
FOMC Minutes Suggest Balance Sheet May Begin Shrinking This Year FOMC Minutes Suggest Balance Sheet May Begin Shrinking This Year Reviewed by Marc Chandler on April 05, 2017 Rating: 5
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Dialing it Up on Hump Day

April 04, 2017
The dollar is practically unchanged against the euro and yen in the first two sessions of the week.  The pace can be expected to pick up starting Wednesday.
Japan's service and composite PMI's rose to 52.9 (from 51.3 and 52.2 respectively). It confirms what we (and others) have recognized, namely that Japanese growth strengthened in the fir…
Dialing it Up on Hump Day Dialing it Up on Hump Day Reviewed by Marc Chandler on April 04, 2017 Rating: 5
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Inclusion in SDR Does Not Spur Official Demand for the Yuan

April 03, 2017
The inclusion of the Chinese yuan in the SDR basket at the start of Q4 16 did not appear to prompt central banks to include it in their reserves.The latestIMF COFER report showed that as of the end of 2016, the dollar value of the yuan in held in reserves was $84.5 bln, which is in line with estimates of both private and public sector economists p…
Inclusion in SDR Does Not Spur Official Demand for the Yuan Inclusion in SDR Does Not Spur Official Demand for the Yuan Reviewed by Marc Chandler on April 03, 2017 Rating: 5
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Emerging Market Preview for the Week Ahead

April 02, 2017
(from my colleague Dr. Win Thin)

 EM FX was mixed last week.  The rebound in oil helped some, such as COP, RUB, and MXN.  On the other hand, idiosyncratic political risks weighed on South Africa.   This week could pose a challenge to EM, with lots of Fed speakers, FOMC minutes, and US jobs data.

Thailand reports March CPI Monday, which is expected to…
Emerging Market Preview for the Week Ahead Emerging Market Preview for the Week Ahead Reviewed by Marc Chandler on April 02, 2017 Rating: 5
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Speculators Continue to Peel Back Long Dollar Bets

April 02, 2017
In the CFTC reporting week ending March 28, speculators mostly added to gross long currency futures and covered gross short positions. Although most positions adjustment were modest, tit continued a recent trend, and positioning is not the kind of headwind it was at the start of the year.  
This is especially true in the euro. Speculators hold a ne…
Speculators Continue to Peel Back Long Dollar Bets Speculators Continue to Peel Back Long Dollar Bets Reviewed by Marc Chandler on April 02, 2017 Rating: 5
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The Macro Backdrop at the Start of the Second Quarter

April 02, 2017
The macroeconomic fundamentals have not changed much in the first three months of the year.  The US growth remains near trend, the labor market continues to improve gradually, both headline and core inflation remain firm, and the Federal Reserve remains on course to hike rates at least a couple more times this year, even though the market is skept…
The Macro Backdrop at the Start of the Second Quarter The Macro Backdrop at the Start of the Second Quarter Reviewed by Marc Chandler on April 02, 2017 Rating: 5
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New Month, New Dollar?

April 01, 2017
The US dollar rose against most of the major currencies in the last week of March, except the Australian and Canadian dollars, and the British pound.  The greenback's recovery from the losses suffered amid questions about the Trump Administration's ability to enact its economic program despite the Republican Party having a majority in both…
New Month, New Dollar? New Month, New Dollar? Reviewed by Marc Chandler on April 01, 2017 Rating: 5
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