FX Vol gone AWOL, directionality has not

This is a summary – Read the full research piece here     Olivier DesbarresOlivier Desbarres is an economist, strategist and entrepreneur. He is Director and Founder of 4X Global Research. 4X Global Research was founded by OIivier Desbarres in 2017, and the firm provides both institutional and corporate clients with substantive research, high-quality analysis and insight on emerging and

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Draghi’s ECB legacy – stable Euro, weak inflation

European Central Bank President Mario Draghi will step down at the end of his eight-year term on 31 October. Christine Lagarde, the head of the IMF – which has implicitly called for looser global monetary policy – will take over pending European Parliamentary approval. The ECB’s dovish turn at its 6th June policy meeting, Draghi’s talk of possible monetary policy

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Renminbi depreciation true to form

We noted in “Renminbi depreciation – Case of déjà vu” (16 May 2019) that the Renminbi’s performance since early March had been very similar to that of May-June 2018 and that if, as we expected, history was to repeat itself the Renminbi would weaken further. While the Renminbi Nominal Effective Exchange Rate was broadly stable between 16th and 30th May,

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More to FX markets than US-China trade war

Over-arching global themes, including the escalation in the trade war between the US and China since 5th May and global risk appetite jitters, offer a plausible explanation as to why the safe-haven Japanese Yen and Swiss Franc have both appreciated 2% in Nominal Effective Exchange Rate terms while the Chinese Renminbi has depreciated by as much. However, global macro and

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Three Themes: Low FX vol, EM contagion and global growth

We touch on three key themes this week, which we will further explore in forthcoming FIRMS reports. Theme 1: Low FX volatility Despite significant event risk, including ongoing China-US trade negotiations and Brexit, and central banks’ dovish shift in recent weeks, volatility in major currency pairs – with the exception of the Turkish Lira, Brazilian Real and Argentine Peso –

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Brexit: Another 48 hours

The House of Commons (HoC), the lower house of parliament, will on 12th March hold a legally-binding vote on whether to approve Prime Minister May’s draft Brexit deal – the Withdrawal Agreement and Political Declaration on the UK’s future EU relationship. We expect the outcome of this critical vote to be closer than on 15th January when an all-time high

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