Latest Posts

  • Raising the White Flag

    Aug 13, 2008 / 3:56pm / in Eastern Europe, General, Interest Rates, News Releases, Western Europe, Forex News

    It is not easy for many to admit that they made an error. It seems the President Trichet might finally be starting to embark on that difficult path. After raising rates in the Euro-Zone over the protests of many top figures within that continent, Trichet finally admitted what the rest of the world had realized some time ago: the Euro-Zone’s growth prospects are weak. This announcement/confession reflects that the ECB is starting to question if it did the right thing in raising rates.

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  • What’s Next?

    Jun 30, 2008 / 4:11pm / in Eastern Europe, Fundamental, General, Interest Rates, Western Europe, Forex News

    With this week’s ECB’s decision all but official, a more important question looms: what’s next? The ECB is a bank whose primary focus — witnessed in both its charter and its past actions — is price stability. Despite poor economic performance in recent months, the ECB essentially has to raise rates this week, as the Euro-Zone’s current inflation level is double the target of 2%. While President Trichet and his peers may pray that a single, small hike will be enough to curb rising inflation, the more likely scenario is that the policy move will not have a huge effect.

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  • Random Country Report: Part 2 - Egypt

    Jun 27, 2008 / 12:32pm / in Africa, Fundamental, General, Interest Rates, News Releases, Forex News

    The markets are closed, Wall-E is opening in theatres, and by now most people have at least a foot out the door for the weekend. After writing all week about the USD, the Fed, and about how I am a better forecaster of market movements than my colleague John, I have decided to do the second piece in the Random Country Report Series. Excluding Antarctica and its rather inactive central bank (please see below), the continent with the least amount of coverage in the world of foreign exchange is Africa.

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  • Game Time!

    Jun 24, 2008 / 4:14pm / in Fundamental, General, Interest Rates, News Releases, United States Dollar, Forex News

    As I have explained before, there are some days when there is little of note in the FOREX world, so I get the chance to research a random economy somewhere in the world. Today (and I’m sure tomorrow) is not such a day. Everyone’s favorite superpower, the United States of America, came out with important economic data today, and will have even more important data tomorrow. US Consumer Confidence was lower then expected, and the lowest it has been since 1992.

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  • Random Country Report: India Revisited

    Jun 23, 2008 / 12:57pm / in Asia, General, Interest Rates, News Releases, Forex News

    My assignment for the day: write 200 times “Next time I will not get too excited when I write about India’s short term economic situation.” For those who have been following India in the past few days, the developments seem anything but the rosy picture I painted last time around. Sure, in the long run, India is still poised to have solid and sustainable growth. However, their current battle with inflation may be more than just a bump in the road.

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  • Big Week Ahead!

    Jun 23, 2008 / 9:28am / in Fundamental, General, Interest Rates, United States Dollar, Western Europe, Forex News

    In some weeks, the news highlight in the FOREX world is an Italian report on car sales. Other weeks, the major headline is that Nigerian workers are striking against the oil companies. However, this week, there’s plenty to be excited about, especially the most important gathering since the meeting of the Five Families: the U.S. Federal Reserve Open Market Committee Meeting.

    Ladies and Gentlemen, start your engines.

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  • Random Country Report: Part 1 - India

    Jun 18, 2008 / 10:27am / in Asia, Fundamental, General, Interest Rates, Forex News

    Some days, I know exactly what I’m going to write about. On days that I don’t, I usually peruse through the news, trying to find something that piques my interest. Today’s top headlines in the currency sector centering on the US Dollar not doing anything as there’s little to trade on... thanks for the help world. So, I have decided that on days such as this, a day with little of note on the economic calendar, I would focus on a country (and its currency) that rarely gets much discussion in the world of FOREX. Today, that country is India.

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  • US Dollar - Predicting the Future (Part 2!)

    Jun 16, 2008 / 12:25pm / in Americas, Currency, Fundamental, Interest Rates, Oil, United States Dollar, Forex News

    Last week I mentioned that though the G8 conference would impact the US dollar in the short term, the ultimate fate of the USD will ultimately be determined more by Bernanke than by anyone else. The Group of Eight’s meeting has come and gone, offering little good news for the USD. In the FOREX market, that “little good news” led to bad news for the USD, as the greenback surrendered some of the territory it had gained last week. So with the conference in the rear-view mirror… let’s look ahead.

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  • Financial Conditions Look to Be Better

    Aug 24, 2007 / 7:18am / in Economics, Interest Rates, News Releases, Forex News

    Calm seems to be returning to international financial markets.  US economic data released today surprised to the upside.  The US dollar is even losing its safe-haven bid with fear not as dominant in the market as in days past.  We could even see conditions set up for a normalization of credit and liquidity in the last quarter of the year.

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  • Carry Trade Coming Back?

    Aug 23, 2007 / 8:31am / in Carry Trading, Interest Rates, Japanese Yen, United States Dollar, Forex News

    Financial markets look to be rebounding after their huge drops in the last couple of weeks. Markets have seen an uptick in value and, and recent news only seems to support that trend. The primary effects of this movement on the foreign exchange market have been twofold: providing the Fed with justification to slow down the easing process and giving Mrs. Watananbe the ability to resume the carry trade.

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