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The bulls added 12.3k yen contracts to lift their gross long position to 97.4k contracts. It is the largest long position since April. The bears added 2.2k to their gross short position, raising to 28.5k contracts.Sterling bulls are a fickle lot. After adding almost 29k contracts to their gross long position in the CFTC reporting week ending September 23, they liquidated 21.1k contracts in the most recent reporting period. The gross long position stands at 48.2k contracts. which matches the four…
varda's Blog
Have Fed Policy Decisions Propped Up Equities?
The stock market rises on days when the FOMC releases its policy statement, probably as a result of some uncertainty being removed for market participants. This pattern has existed for more than 30 years. The Fed's ability to "jawbone" the market higher is no more exceptional now than it was during any prior bull market.Morgan Stanley's (NYSE:MS) chief economist this week stated that the Fed's low-rate policy and "jawboning" are responsible for most of the stock market's gains since 2009. In doi…
The dollar started the week on a back foot dropping
The dollar started the week on a back foot dropping against all the major trading partners and falling especially hard against the yen with USD/JPY hitting a low of 101.69 before finally finding some support.With Japan closed for a holiday and global economic calendar barren of any meaningful data, it's been a generally quiet open to the week, but the downward bias in the buck was obvious from the start of Asian trade.It's difficult to say if today's price action is simply a matter of profit tak…
EURope's Banking Crisis, Negative Rates And Gold
Deutsche Bank (NYSE:DB) and Commerzbank (LON:CZB) are discussing merger talks. The fact that these meetings are occurring is a signal that Germany’s banking troubles are indeed accelerating.The banks are desperately seeking ways to cut costs and improve profitability. Their plans include restructuring and job cuts using highly unconventional measures. In June, Reuters cited anonymous sources saying that Commerzbank was exploring the option of hoarding billions of …
Dollar edges higher despite rate hike uncertainty
The dollar edged higher against the other major currencies on Tuesday, even as comments by a Federal Reserve official on Monday sparked fresh uncertainty over the timing of future U.S. rate hikes.The dollar came under pressure after Fed Governor Lael Brainard warned against raising interest rates too quickly.In a speech on Monday, Brainard says economic progress continues in the U.S., but the Fed would be wise to continue keeping policy loose.The comments came after Boston Fed President Eric Ros…
The Week Ahead: Should We Fear The Fed?
The calendar has little important data. Friday’s sharp selling was widely attributed to the fear of a Fed rate hike in September. Is it time? Should we fear the Fed?Last WeekThere was not much news, and it was another mixed picture.Theme RecapIn my last WTWA, I predicted a continuing discussion of the Fed and the timing of the first rate increase, combined with concern over a September market correction. The first part was pretty accurate all week, but the market remained quiet. The modest tradi…
USD Pushes Lower, But Do FOMC Minutes Really Trump Dudley?
It is not a good day for the US dollar. It is being sold across the board. The seemingly dovish FOMC minutes released late yesterday appears to have gotten the ball rolling. The takeaway for many was that any officials wanted more time to assess the data at the July meeting.The question is whether two months more data is sufficient.The market did not have much confidence (less than one in four) chance of a hike in September. …
UK labor market shows little sign of immediate Brexit hit
The number of people claiming unemployment benefit in Britain unexpectedly fell in July despite the shock decision by voters to leave the European Union, suggesting little immediate impact from Brexit on the labor market.Benefit claimants fell by 8,600 in the month, compared with an increase of 900 in June, and there was only a small fall in the number of jobs employers were trying to fill, the Office for National Statistics said on Wednesday.Economists taking part in a Reuters poll had expected…
Dollar Slumps, But Driver May Not Be So Obvious
The US dollar is being sold across the board today. TheUS dollar index is off 0.65% late in the European morning, which, if sustained, would make it the largest drop in two weeks.The proximate cause being cited by participants and the media is weak US data that is prompting a Fed re-think.However, we are a bit skeptical. It is not that the US data has been strong, or that Fed officials have been touting the need to hike like many regional Fed Presidents did earlier this year. Rather, our skeptic…
Dollar Shakes Off Weak Retail Sales, A Sign Of Strength
By Kathy Lien, Managing Director of FX Strategy for BK Asset Management.The U.S. dollar ended the week lower against most major currencies. We saw some dollar weakness at the start of the week but the disappointing retail sales report sealed the greenback's fate. Consumer spending stagnated in July and dropped -0.1% excluding auto and gas purchases. …