The dollar managed to recoup some of its recent losses amid a quiet, pre-holiday session as risk sentiment was not as boisterous as earlier in the week. The Australian and New Zealand dollars held their ground versus the dollar but the other G10 currencies ceded ground as the session progressed. Equities finished modestly positive and longer-dated Treasury yields were moving up before the session ended early per the holiday. WTI and gold are $112.28 and $1505.23 at the time of writing. EURUSD traded 1.4533-1.4619, USDJPY 81.63-82.06. Continue reading →

The return of political economics gives rise to some concern as markets are generally bad at pricing political risk. The electoral calendar over the last two months has not tended to favour incumbents. This is perhaps not surprising given that the weak economic recovery is sufficient to reduce conservatism, while the sluggish labour market response has fostered a desire for change. A variety of votes lies ahead. We explore what’s in store in Portugal, the UK, Canada, Germany and Italy. Continue reading →

The dollar continued to weaken during the Asia session. Some positive US earnings reports were a factor in this, helping to keep risk appetite supported. However, given that USDJPY and USDCHF remained heavy too, a certain amount of general dollar negativity is also driving the price action. EURUSD traded 1.4486-1.4603, USDJPY 81.97-82.60. Continue reading →