Weekly Report
Yen Staying Bearish after a Wild Ride; Dollar Index Presses Key Resistance
The global financial markets found themselves in a flurry of volatility in the past week, underpinned by policy decision of three major central banks in North American, Europe, and Asia. Yen and Nikkei had the wildest roller-coaster ride in reaction to BoJ's tweak to their Yield Curve Control. In...
Dollar Turned into Consolidation Phase as Selling Passed Climax
Dollar recovered broadly last week and it seemed to have emerged from its near-term selling climax. While it's premature to call for bullish trend reversal, the greenback has likely entered at least a consolidation phase, with potential for a more robust recovery on the horizon. Dollar's next move will...
Dollar Nose Dived after Inflation Data, But Two Hikes Still on the Card?
Following the release of data indicating a steeper than anticipated slowdown in inflation, Dollar saw a marked decline last week, securing its position as the week's most significant loser in the currency markets. Concurrently, surge in stocks and tumble in benchmark treasury yields accompanied Dollar's descent.
At this juncture, it...
Yen Setting Up Bullish Reversal, Dollar Index Ready for 100 and Below
Japanese Yen exhibited an impressive rally last week and ended as the strongest performer. The move was spurred by Japan's substantial wage growth, which shot JGB yield higher and countered the impact of rising benchmark yields in the US and Eurozone. In light of these developments, signs are pointing...
Markets Resist Fed’s Outlook of Multiple Hikes: Bonds and Stocks Disagree, Dollar Rally Halted
Dollar bulls experienced a somewhat disheartening week, as the initial rally supported by hawkish remarks from Fed Chair was halted by subsequent inflation data release. Consequently, the greenback managed to secure only the third position for the week, trailing behind Swiss Franc and Euro.
The vigorous late-week rally in US...
Recession Concerns Eclipsed a Week Laden with Key Event; Aussie Bear the Brunt
A cloud of recession fears dominated a week full of significant events, with disappointing PMI data, particularly from Eurozone and US, dampening sentiment towards the end. Investors also grappled with mismatched expectations concerning Chinese fiscal stimulus, which added additional pressure on global stock indexes, driving them lower by the...
Global Markets Unfazed by Central Banks’ Moves, Risk-On Sentiment Prevails
Despite policy tightening from ECB and Fed's hawkish hold last week, global markets largely shrugged off the central banks' actions. Investors' sentiment remained buoyant, propelling many global markets to impressive rallies. Germany's DAX index even recorded a new all-time high.
In the forex market, Yen took a significant hit and...
RBA and BoC Bombshells Stir Market Waters; Dollar, Euro and Yen Suffered
Last week marked the beginning of an avalanche of central bank surprises, with both RBA and BoC springing unexpected rate hikes on markets. However, the market reactions diverged substantially. Despite a weaker-than-anticipated Australian GDP report and terrible Chinese trade data, Aussie's underlying strength was striking. In contrast, the Loonie's...
Risk-On Sentiment Continued, Dollar Relatively Resilient Despite Receding June Hike Expectations
Global stock markets registered impressive gains last week, with the resolution of the US debt ceiling and robust American job data contributing to the bullish momentum. The ebbing expectation of a Federal Reserve rate hike in June also provided additional support. Canadian and Australian dollars emerged as the week's...
Dollar Dominates as Market Anticipates Another Fed Rate Hike in June
Last week saw the US Dollar dominating the currency markets, with a surprising rally buoyed by market sentiments flipping in favor of an imminent Fed rate hike in June. An atmosphere of growing optimism pervaded the scene, buoyed by increasing confidence in a forthcoming agreement on raising the US...
Yen Struggled as Global Stock Markets Shone, Kiwi Reigned Supreme
Last week, the financial markets made a dramatic U-turn, as many key global stock indexes recorded substantial gains. Despite underlying concerns, the looming issue of US debt ceiling seems on track to be resolved, thus avoiding a default. US Treasury Secretary Janet Yellen's explicit warnings appear to have had...
Dollar, Yen, and Swiss Franc Lead Currency Markets, Suggestive of Risk Aversion
In the currency markets last week, Dollar, Yen, and Swiss franc Emerged as the standout performers. Conversely, New Zealand and Australian dollars lagged, painting a picture suggestive of risk aversion within the markets. However, this sentiment has not yet manifested itself in the stock markets, at least not with...
Roller-Coaster Week for Investors Ended with Commodity Currencies on Top
Risk-on, risk-off, and then risk-on. It's a roller-coaster ride for investors last week,with a slew of heavy-weight events. In the end, commodity currencies ended as the best performers, with support from rebound in sentiment. Canadian Dollar held a slight advantage over Australian and New Zealand Dollar. But all have...
Yen and Aussie Down after Volatile Week, Risk-On Sentiment to Continue
The markets experienced surprisingly high volatility in the last week of April, with central bank expectations as the primary driver. Japanese Yen emerged as the worst performer following BoJ's dovish stance, leading bond traders to abandon hopes for any changes to yield curve control. Australian Dollar was the second-worst...
Market Focused on Central Bank Expectations, Commodity Currencies Struggle
Last week, market movements centered around central bank policy expectations, with limited clear alternate influences. Comments from Fed officials and recent economic data suggest that Fed's tightening cycle is not over yet. This pushed US Treasury yields higher, but stock market indexes remained relatively stable. The steady market sentiment...
Dollar’s Fate Uncertain Amid Mixed Week: Risk Sentiment, Stocks, and Bonds in Focus
Dollar fell to its lowest level of the year and breached a critical support, after being under pressure for most of the week. Yet, it staged a recovery towards the end, closing mixed only. Decelerating US inflation data was welcomed by risk market investors, but a lower terminal rate...
Banking Concerns Subside, Inflation Worries Ease, Dollar Lost Ground
Last week, investors appeared to view the banking crisis as well-contained, pushing it into the rearview mirror. Confidence saw a revival, resulting in significant gains for major global stock indexes. In tandem with the lower-than-anticipated inflation figures from the US, market sentiment underwent a notable shift, paving the way...
Market Confusion Reigns While Yen Continued Domination
Last week's financial landscape was far from clear-cut. While it wasn't a definitive risk-on market, investors seemed reluctant to abandon US shares completely. The markets found themselves mired in confusion, struggling to make sense of the relentless barrage of headlines detailing bank crises that began with Silicon Valley Bank,...
Yen Dominates as Market on Brink of International Banking Crisis
Last week, the world appeared to be on the brink of an international banking crisis. The situation might have stabilized with Silicon Valley Bank filing for Chapter 11 bankruptcy, First Republic Bank receiving aid in the form of deposits from major players, and Credit Suisse obtaining a CHF 50B...
Silicon Valley Bank’s Collapse Outweighs Interest Rate Developments
Last week, investors were caught off guard by a series of surprises. However, the largest bank failure in the US since 2008 proved to be the most overwhelming for them. The risks of contagion from Silicon Valley Bank appeared to outweigh concerns about higher interest rates, inflation, and recession....