Author archives

The market is moving to shrug off the post Nvidia earnings malaise. While their revenues may have advanced by 122% from a year ago, beating expectations, the company also increased revenue expectations for the current quarter and announced a share buyback, the stock has struggled as investors were less than enthused by the outlook or by production snags.

The key dynamics in the upcoming session centre on latest US retail spending data alongside continuing jobless claims, albeit not covering the payrolls survey period.

We head into the session against the backdrop of a material cheapening in the JPY as BoJ Deputy Governor Uchida ( a relative dove) pushed back against the notion of additional tightening should markets remain unstable.

Into the Start: We have witnessed another quiet overnight session as markets brace for the trio of central bank decisions, starting with the BoJ overnight tonight. However, ahead of the triumvirate of policy decisions we have additional US macro data into terms of JOLTS job openings and consumer confidence.

Bipan is joined by UK-based FX Strategist Jeremy Stretch to discuss the UK budget, the gilts market and why the GBP collapsed over the past few days. Also, what can we expect from the Bank of England/UK Treasury going forward. Please note that this was recorded before the BoE announcement to buy long-end gilts on September 28.

Bipan and guest Jeremy Stretch review the recent European Central Bank and Bank of England meetings and go over what the next steps are for each central bank. 1:00 – 4:50: ECB meeting review 4:50 – 9:05: Inflation in the Eurozone / Why central banks are reacting to supply-side driven inflation 9:05 – 14:00: ECB next steps and sequencing 14:00 – 21:00: Market pricing for ECB hikes / Switching from the deposit rate to the refi rate 21:00 – 25:00: Hashing out the BoE rate hike and the terminal rate in the UK 25:00 – 29:40: On the BoE selling gilts 29:40 – 33:50: Period between rate hikes and QT for the BoE 33:50 – 37:05: Rapid fire questions

We entered 2021 anticipating that a broad reflationary bias would result in the NOK proving to be the continent’s top performer. As we move towards Q2, the Norges Bank is likely to be the first major central bank to hike (watch for a potential move as soon as September). The combination of positive domestic fundamentals allied to the boost from rising oil prices underlines why we see little reason to change our positive NOK conviction.

Ian is joined by his colleague Jeremy Stretch this week, our Head of G10 FX Strategy. Jeremy discusses all aspects of Brexit, from the political climate to the yield curve to prospects for the GBP. Ian identifies some potential curve divergence between the UK and Canada, and ruminates on the merits of a relative CAD steepener versus GBP flattener.