Weekly Market Commentary
Global Currency wars erupted to close out a week dominated by trade wars. Trump broke protocol and directly criticised the Federal a Reserves monetary policy, meanwhile exposing China and the EU, for currency manipulation. In a wide ranging interview Trump criticised the Feds policy of raising interest rates, adding to the cost of capital, while bolstering the Big Dollar. Trump has asserted that the Chinese have been surreptitiously devaluing their currency to boost their already substantial trade advantage, as does the ECB, leading to a new front to the economic war. There is no such thing as boring in the world according to Trump!
The overall impact was a retracement of the Dollar. The EUR surged back to 1.1720, while the GBP jumped to 1.3150, endorsing the power of the 'bully pulpit'. Trade concerns, that were so significant 24 hours before, were forgotten. Trade exposed, commodity currencies reacted accordingly, with the AUD regaining 0.7400, while the NZD pushed back to 06800.
Whatever wind blows this week, will certainly come for the Genesis, Trump. Trade wars, currency wars, peace agreements. Never boring!
Weekly Market Calendar
23/7 Chicago a Fed National Activity Index, EU Consumer a Confidence, US Existing Home Sales
24/7 Australia a Consumer Confidence, Japan Manufacturing PMI, France/German/EU Manufacturing/Services/Composite PMI, US House Price Index, US Manufacturing/Services/Composite PMI, Richmond Fed Manufacturing Index
25/7 NZ Trade Exports/Imports, Australia CPI, US Weekly Mortgage Applications, US New Home Sales
26/7 German Consumer Confidence, ECB Report, US Trade, US Durable Goods Orders, Kansas City Fed Manufacturing Activity Report
27/7 NZ Consumer Confidence, Japan CPI, France GDP, University of Michigan Sentiment
Paul Bettany
Collinson & Co
0406-744-923
paul@collinsonfx.com