If there seems to be more safe haven demand of late, the increasing odds of British exit from the EU is being blamed. According to Yahoo!Finance, Goldman Sachs sees “kinks” in the option structure, an agglomeration of hedging demand that points to maturities around the UK referendum. The absence of any heavy hedging this week suggests that markets have no [...]
With stocks down for a second day, attention has been focused on the UK vote potentially in favor of leaving the EU. It seems like a naturally disruptive event, or at least in theory, an outcome that the mainstream globalist persuasion continues to emphasize. That is certainly one possible explanation, but a more likely scenario is one where CNY plays [...]
In August 2013, the Treasury Department through its Treasury International Capital data (TIC) put a scale on that summer’s disruption. With a two month delay, the TIC figures gave us some insight as to why the fixed income/MBS selloff that summer was so violent; and further why it had so easily spread to currency markets. The destabilization of that event [...]
It makes for yet another huge dichotomy, but one which is curiously absent from any mainstream commentary. As noted earlier today, Chinese imports were pleasantly surprising for the mainstream as they were just about flat year-over-year. The fact that oil imports surged by nearly 40% seemed only to confirm that whatever might be happening on the export side (another dichotomy [...]
To the surprise of no one, the Chinese yuan on Monday picked back up where it left off last week with Friday’s big move only shifting the level from which it now sinks. Straight from the Asian open, CNY quickly traded lower and settled again closer to 6.57. If it exposes Friday’s reversal as a one-day, knee-jerk reaction then it [...]
By any reasonable standard, today’s trading in “dollars” was highly unusual. The Chinese yuan had been trading its typical depreciation route all through the night and toward the US open. At about 6:15am, CNY was just about to touch 6.59 and a new low that would have put it back into early January territory (not good). It traded modestly higher [...]
China’s official manufacturing PMI was unchanged at 50.1 in May. As such, the media doesn’t know what to make of it. It’s slightly less than the 50.2 “rebound” in March, but still more than the drastic low of 49 in February. Because the index value is above 50, commentary is generally of cautious optimism. We have seen this before, several [...]
The People’s Bank of China today fixed the CNY exchange (reference) rate below 6.56 for the first time since early February. That means all the tremendous effort that went into erasing December and January’s “dollar” pressure (not devaluation) has been unwound, as the currency now trades just about where it was at the start of China’s Lunar New Year Golden [...]
In this brave new banking world of impenetrable bureaucratic morass designed to keep us all from ourselves (slogan: don’t panic, there’s a lot of new math), there are new acronyms for just about anything. To regulators, some groups of letters mean a lot more than they might for banks, while investors, loosely defined, focus on still others. One such term [...]
With stocks falling today continuing somewhat yesterday’s post-FOMC selloff there was going to be universal citation of monetary policy; or at least these new expectations of monetary policy coming supposedly for June. The dominant narrative remains in favor of Fed power where stocks don’t do well without it. So as the central bank removes so very slowly its “accommodation” we [...]
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