Risk aversion, not panic, in face of uncertainty
Major currencies, equity markets and the price of crude oil since 8th June – the cycle low in the US Dollar – have exhibited reasonably limited directionality, narrow trading ranges and very low volatility, with the notable exception of currencies in Latin America.
However this is not a case of more confident financial market participants finding their feet, in our view. Rather it is a reflexion of greater global risk aversion, with financial markets unable to see through the smoke and reluctant to pit themselves against their peers and test monetary authorities’ resolve at a time of still acute uncertainty on many levels.
ERI-C Webinar – Thursday 2nd July (09.00 & 14.00 London time)
I will be presenting on “Opportunities In Global FX & Rates: Amid The Misguided Debate On The Shape of Recovery”
- Misguided debate about the shape of a global recovery and nonsensical proliferation of letters;
- Unprecedented monetary and fiscal stimulus driving equity bubblebut bogeyman of hyperinflation;
- US Dollar, Swiss Franc, Yen and gold “safe-haven”outlook – myth vs reality;
- Key drivers of FX & rates markets,including path of national lockdowns, central bank and government policies, renewed focus on domestic macro data and market positioning;
- FX volatility & directionality, with a focus on scope for EM currencies(including Renminbi),Sterling, Euro and Aussie and Kiwi Dollars to outperform or underperform; and
- Cost-benefit of reasonably low international oil price.
To register in advance and be sent joining details, alongside rights to an exclusive special research offer, please click on your preferred Thursday 2nd July session link:
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Olivier is an economist, rates & FX strategist and entrepreneur with over 21 years experience in financial markets. He is Director and Founder of 4X Global Research, an independent, London-based consultancy which provides institutional and corporate clients with substantive research, high-quality analysis and insight on emerging and G20 economies and financial markets.