currencies

Speculation of some agreement has helped lift the euro, peripheral bonds, and generally has underpinned the risk appetite in recent days. This leaves the market vulnerable to disappointment or a "buy the rumor sell the fact" type of…

Something interesting is being played out. Margin traders--the famed Mrs Watanabe-- at the Tokyo Futures Exchange--have amassed a large short yen position. There are about 900k short yen contracts as of today and about 364k are short yen…

There seems to be an aggrieved sense on the part of creditor nations that after providing so much helpful funding to undisciplined debtors, the creditors are going to be left with losses. There is, they claim, something terribly unfair…

Safe havens trade on the back foot as risk appetite resurgences; BoC expected to remain on hold. Options pricing suggests that the market is prepared for the worst ahead of Thursday’s summit. In the EM space macroprudential measures in…

At the weekend, I saw three articles asking essentially the same question about sovereign debt crisis contagion: why Italy and why not Japan (the US or Germany)? Here's my answer.

In my view, fiat currency is a confidence trick. The key to confidence in a fiat currency is the belief of citizens that the government issuing the currency will manage its finances in a way that promotes general “life, liberty and…

There is, and historically has been, some confusion surrounding sovereign currency. So, many policy makers and economists have had trouble understanding why the private sector would accept currency issued by government as it makes…

Dollar and other safe havens remain firm amid EZ uncertainties; stocks and commodities retreat. The week ahead is likely to be dominated by EZ summit, debates surrounding US budget and earnings. EM investors continue to focus on the…

Officials from Japan and Switzerland have stepped up their rhetoric protesting the price action that has propelled their respective currencies sharply higher. Contrary to market anxiety the risk of intervention remains low and lower for the…

Dollar pares recent gains as EZ struggles to control crisis; Global stocks boosted by Asian data reports. North American session likely to be dominated by Bernanke; further easing unlikely but still possible. Chinese economic narrative…