CBs proved to be savvy buyers of gold over 3Q22, scooping up record volumes of the metal as prices remained weak. The exorbitant privilege accorded the USD’s reserve-currency status will continue to erode as EM states move to…
A client concerned about the slump in asset prices, the stubbornness of inflation, and rising bond yields asks what went wrong, and what happens next? This report is the full transcript of our conversation.
Central banker messaging after the latest rate hike announcements in the US, UK and Australia indicates a shift in focus from the pace of hikes to how high rates must rise to slow growth and bring down inflation. This represents the…
The HK dollar is under an assault from rising US interest rates and a weak economy. To defend the exchange rate peg, the HKMA will continue to tighten liquidity, which will boost HK interest rates above those in the US across the…
According to BCA Research’s Foreign Exchange Strategy service, long-term investors should begin to sell the dollar on strength. From a pragmatic standpoint, there are five key signposts that have been useful in tracking…
In this report, we identify 5 key signposts that will mark a turn in the dollar. These include technical conditions, foreign real interest rates, US (and global) yield curves, Chinese economic conditions and geopolitics. We then…
The Norwegian krone was the best performing G10 currency in October, appreciating by 4.7% versus the USD over this period. This marks a reversal following a 19% decline in the first nine months of the year, during which it was…
Provided that US inflation is due to excess demand rather than supply constraints, demand destruction will likely be needed to bring core inflation below 3.5%. Such growth contraction is positive for counter-cyclical currencies like…
As anticipated, the Reserve Bank of Australia lifted the Cash Rate by 25bps to 2.85% on Tuesday. This marks the second consecutive quarter-point increase, after it unexpectedly slowed the pace of hikes last month. The decision…
In Section I, we note that while recent inflation developments point to some supply-side and pandemic-related disinflation, they also point to potentially stickier inflation over the coming several months. The inflation, monetary…