The US dollar lost ground against all the major currencies last week. It looks poised for additional near-term weakness.
A technical look at the currencies. The phase that has characterized the first few weeks of the year has ended and a new one has begun.
We’ve all done it, haven’t we? Chucked something in the wash and turned it on too high, only to see it pop out at the end of the cycle and it ends up the size of your hamster. Well, Obama has been doing the same. Except this time it’s not your winter woollies that he’s shrinking, it’s the greenback.
Overview of forces impacting stocks, bonds and currencies.
Overview of the price action in the foreign exchange market.
In a week that has been marked by astonishing mainstream media headlines, BFI Capital’s CEO Frank Suess happened to give an outstanding interview about the outlook for global currencies, gold and manipulation in the markets. These developments are significant and could mark a tipping point. Up until now, the currency and precious metals manipulation has been a topic associated with conspiracy theorists in the corners of the blogosphere. The interesting fact is that this news breaks out exactly at the time when most people are being trapped into the “economic recovery” news. With the markets hanging at the lips of the central bankers, it is fair to say that “the central banks are the markets.” Frank Suess points out that, for several decades now, central banks around the world, with the US Federal Reserve in the lead, haven’t allowed business and credit cycles to happen anymore. In fact, they have been fighting consistently every sign of recession with more money, resulting in a race to the bottom of world currencies. The effect of this on world currencies is that they are shuffling each other down in a see-saw pattern...
Overview of the dollar's outlook against the major currencies, without a preconceived notion that the US is in some kind of terminal decline.
A look at the technical condition of the fx market, interest rate differentials, central bank developments and the data due out in the week ahead.
The recent strength of the euro and sterling seemed to evaporate, while the yen and dollar-bloc currencies recovered. Is this a major trend change or was it simply reflecting some position adjustment in a thin market?
A little followed development is revealing about the emerging financial architecture and the role of the dollar. A dispassionate discussion.
Allegations that banks are manipulating gold prices lower continue to gain credence and Bloomberg have published an article by Rosa Abrantes-Metz entitled ‘How to Keep Banks From Rigging Gold Prices’
FX outlook through the end of the year...
Malodorous taper emanations and bankruptcies are a toxic mix for munis
Overview of market positioning and technical indicators on the eve of the FOMC meeting.
While the perma bears may find comfort in the dollar's decline, its weakness has not been very broad, but really limited to the euro, sterling and currencies that move in their orbit. Still further dollar declines look likely near-term.