Know What's Happening in Currencies
Know What's Happening in Currencies
Yen emerges as world’s cheapest funding currency, fueling a $435B carry‑trade
The Bank of Japan’s ultra‑loose stance has turned the yen into the cheapest source of funding globally, underpinning a massive carry‑trade that amassed roughly $435 billion between 2022 and 2024. A modest rate hike in March 2024 barely dented the trade, but markets remain wary of a sudden, aggressive tightening that could compress spreads and force borrowers to unwind yen‑denominated debt.
The Reserve Bank of India has drafted a rule requiring foreign‑bank branches in India to report all non‑deliverable forward (NDF) contracts to the Clearing Corporation of India Ltd. The proposal mandates disclosure of notional values, counterparties, maturities and settlement dates, aiming to give regulators real‑time insight into offshore rupee‑linked derivatives. Foreign banks argue that many NDF trades occur outside India, making data collection difficult and raising jurisdictional and client‑privacy concerns. Their resistance could force the RBI to seek alternative data‑gathering mechanisms or impose stricter compliance requirements.
AUD/USD dropped more than 1% from its multi‑year peak as the U.S. dollar rallied on heightened safe‑haven demand. Inflation expectations in Australia rose to 5.2%, prompting markets to price a 78% chance of a 25‑basis‑point RBA hike at the March...
The Japanese yen slipped to a fresh low of 124.78 per Singapore dollar, driven by a sharp rise in oil prices linked to the escalating Middle East crisis. Oil breached the $100‑a‑barrel threshold, pushing Japan’s import bill higher and prompting...
In the inaugural Gundlach Unlocked webcast, DoubleLine CEO Jeffrey Gundlach warned that inflation is likely to stay above the Fed’s 2 % target, long‑term rates remain elevated despite recent cuts, and the U.S. dollar may enter a weaker phase. He outlined...
The Central Bank of Turkey kept its one‑week repo rate at 37% and left the interest‑rate corridor unchanged at 35.5%‑40%, signaling a pause amid heightened global risk and rising energy prices. In its statement the bank shifted away from an...
I think it is a mistake to think that Japanese officials actually defend a fixed USD-JPY level. It makes sense to be cautious about the $USD in general as interest rate differentials have moved against it. It is a...
The $DXY Dollar Index has advanced to close at a three-month high while also clearing some channel and Fib resistance on the close. Notably, the market's FOMC rate expectations for 2026 have also extended their shift, now only pricing in...
The USDCAD pair is testing a well‑defined resistance ceiling at 1.36065, matching the week’s high. Repeated failures at this level have made it a critical barometer for market sentiment. A decisive break above could unlock bullish momentum toward the 50%...
Failed breakout to clear the 2023 high in $AUDUSD Now off more than 1.6% off the high. Support now 7037 with 6913/43 still key. Resistance 7158 with 7208/14 critical #AUDUSD Daily Chart https://t.co/Cui4nVGM5q
The president expresses a desire for a rare intermeeting rate cut. The last one occurred on March 15, 2020, as the Covid shock overwhelmed financial markets. The Fed's next scheduled policy decision announcement—widely expected to be no change in rates—is in...
The U.S. dollar opened the North American session mixed, firming against the euro and pound while slipping against the yen after testing 2026 highs. Technical analysis highlights key support and resistance levels on EUR/USD, GBP/USD and USD/JPY as traders brace...
Could the Bank of England defer a possible rate cut next week? https://t.co/f0T8D0P94L #GBP #FOMC
British Pound Short-term Outlook: GBP/USD Bears Charge Pivotal Support for a Seventh Time https://t.co/S0r6Spt5dp $GBPUSD Daily & 240min Charts https://t.co/HERuBmlZ9Y
The Central Bank of Solomon Islands (CBSI) announced an accommodative monetary stance for the next six months, introducing a new policy rate of 1.5% as a primary signal to the market. Growth for 2025 was revised up to 3.6% and...
Today's Opening Bell We covered a lot today- asset chapters provided US Dollar Testing Yearly High as Iran War Escalates https://t.co/7jdA7902Rt
U.S. dollar $DXY, volatility $VIX and yields $TNX all rising in tandem > 20-day EMA... https://t.co/Dv49pGJIRC
In a keynote at the IMF‑Bank of Thailand “Asia in 2050” conference, Bank of Korea Governor Chang Yong Rhee highlighted Asia’s remarkable economic transformation since 1991. Per‑capita GDP across the region has risen nearly eightfold, lifting more than 1.2 billion people...
$USD trading a little softer as the North American session gets underway. Be prepared. https://t.co/d5zBeuqizV
As Bloomberg notes, the yen has reached levels where Japan's Ministry of Finance (MoF) and perhaps Secretary Bessent have a choice to make; the yen is clearly in the zone where intervention is a real possibility 1/ https://t.co/gE34g8gEW4
The Bangko Sentral ng Pilipinas (BSP) received a Central Banking Publications award for its modern approach to foreign‑reserve management. The accolade recognizes the bank’s recent overhaul of its reserve‑management framework, featuring a refreshed strategic asset allocation, active risk‑management techniques, and...
Turkey's current account posted a $6.8 bn deficit in January, far above the $4.8 bn forecast and analysts' $5.4 bn estimate. The gap was amplified by the Central Bank of Turkey's methodological change, which has retroactively added $8.9 bn to interest‑payment calculations since September 2020....
Tiff Macklem warned that the financial system’s growing reliance on non‑bank players is creating new systemic vulnerabilities, especially through hedge‑fund leveraged trading in sovereign bonds and the rapid expansion of private credit. He highlighted that hedge funds now purchase up...
First Deputy Governor Sabine Mauderer presented the Deutsche Bundesbank’s 2025 Annual Report, highlighting a net equity rise to €363 billion and a gold revaluation reserve of €387 billion. The bank’s loss for the year was more than halved, signalling a clear improvement...
The Japanese yen slipped to roughly 159 per dollar on Thursday, its weakest level since mid‑January, as oil prices surged past $100 a barrel. Despite a recent release of foreign‑exchange reserves aimed at supporting the currency, the yen continued to...
My take on the MONEY SUPPLY: "The money supply is always the cause of inflation. There are long and variable lags between changes in the money supply and changes in inflation." THE INFLATION STORY = A MONEY SUPPLY STORY. My latest with @JanetOnTheMoney...
Chinese exporters are scrambling to hedge yuan appreciation, driving a record $39 bn net foreign‑currency sell‑off in January and $100 bn dollar net sales in December. Regulators have issued informal "window guidance" urging banks to lift corporate hedging ratios to roughly 40 %...
Most traders get chopped alive in Asia and London sessions. Not because they're bad traders. Because they ignore one simple signal. When your long-term MA and short-term MA are hugging each other, the market has no conviction. No conviction = no trade. The...
India’s central bank faces mounting pressure to pause its rate‑cut cycle as West‑Asia oil price shocks reignite inflation concerns. A surge in Brent crude, coupled with fading food‑price base effects, threatens to push consumer inflation above the RBI’s 4% target....
Nice to see that @HyunSongShin has officially recognized that stablecoins open the door to an "Uber Surge Pricing" type liquidity market. [Actual gas markets also clear in a similar way, notably the NBP balancing point system.] The below screenshot is from...
The U.S. Bureau of Labor Statistics reported underlying price growth of 0.2% in February, a slight dip to 0.216% versus the whisper forecast. The figure aligned with most economists’ expectations, easing concerns about a resurgence of core inflation. Despite the...
In this episode of the Sound of Economics, former Dutch central bank governor Klaas Knopp and Bruegel director Jeremy Zentelmeier assess Europe’s economic outlook amid the new Israel‑Iran conflict, highlighting the region’s surprising resilience but warning of a negative supply shock from...
The reality is: If you like commodities, you should also appreciate resource-rich economies — and their currencies. Canadian “peso” poised to outperform while it remains one of the most heavily shorted currencies in the world today. You don’t need to tell me...
The Middle East war intensified with three tankers attacked in the Strait of Hormuz, prompting the International Energy Agency to propose a coordinated release of 300‑400 million barrels from strategic reserves. The G7 will discuss the plan, which dwarfs the 180 million‑barrel...
The European Central Bank heads into its March 18 meeting facing a sharp shift in the macro backdrop as the Middle East war drives oil prices higher, removing any realistic chance of further rate cuts. Instead of fine‑tuning inflation forecasts,...
China’s central bank has allowed the renminbi’s daily fixing volatility to surge to its highest level since December 2024, signalling a tolerance for two‑way price swings. The People’s Bank of China set the reference rate at 6.89 yuan per U.S. dollar,...
Barbara Pozdorovkina, Chief Growth Officer of LMAX Group, outlines the firm’s shift from a pure FX venue to a global, cross‑asset marketplace that blends traditional finance with digital assets. She highlights the accelerating convergence of stablecoins, blockchain settlement, and 24/7...
We see three scenarios for the ECB. 1) They hold their nerve "in a good place". 2) They pull fwd the tightening that has long been priced into 27/28 and take the depo rate to the higher end of neutral...
🇪🇺 Not only did @KazimirPeter signal a strong ECB hawkish bias, but he said that every meeting should be alive after March. *ECB'S KAZIMIR SAYS RATE HIKE ON IRAN MAY BE CLOSER THAN THOUGHT "I don’t want to speculate about April or...
USD/JPY is hovering near the 158.00 level as traders grapple with mixed signals stemming from the ongoing conflict in Iran. The pair’s price action reflects a classic Elliott Wave pattern, with analysts debating whether the current wave is poised for...
Traders suffer losses on options after U-turn in ECB rate bets https://t.co/IOlxq962Fs via @highisland @greg_ritchie https://t.co/EsJzYFwmea
Euro Short-term Outlook: EUR/USD Bears Assault Multi-Month Support - Breakdown Risk Builds https://t.co/jTs8wu6sOj $EURUSD Daily & 240min Charts https://t.co/GCs2UbCZkL
The latest Elliott Wave update notes that USDCAD has remained virtually unchanged this week despite extreme volatility in crude‑oil prices. Analysts highlight a critical resistance level around 1.3800 that could dictate short‑term direction. While oil surged 36% following geopolitical tensions,...
Australian Dollar Forecast: AUD/USD Resistance Under Siege – Bulls Eye 7200 https://t.co/Z4xmadvNgr $AUDUSD Weekly Chart https://t.co/GZy1mBhw92
Both US headline and core #CPI for February were both in-line with expectations and previous: 2.4% and 2.5% respectively. Nevertheless, expectations for FOMC rate cuts through this year are the lowest since May 2nd (-30bps). That won't make Trump happy... https://t.co/9kJhHgDilS
You get a different result from the CME tool (derived from a simple probability-weighted average) if you use options prices in the Atlanta Fed's tracker As of Friday, options prices implied a rate hike had risen to around 23%, from 8%...
fun fact: the @bankofcanada has decreased rates 7 times since September 4th, 2024... both Canada 5-year and 10-year yields are higher since they started... #oops
Why the Fed can't do much with a CPI report that's benign on the surface: It doesn't at all resolve the dilemma Fed officials face when the inflation measure they care about most is less encouraging and a major energy...
Middle East War Intensifies, IEA Proposes a Coordinated Release of Strategic Reserves, G7 to Consider: The dollar is mixed as the North American session is about to begin. Heightened expectations of a rate hike next week have lifted the Australian...
$AUD reached its best level since June 2022 amid heightened expectations of a rate hike next week. $USD more broadly mixed. PBOC lows USD fix again. US CPI seems dated but will show floor before the war....
Since the first US-Israeli strikes on Iran just over 10 days ago, the Iranian rial has APPRECIATED by 17% against the USD. THE TRUMP-NETANYAHU ATTACKS ON IRAN = SURPRISING STRENGTH IN THE RIAL. https://t.co/BPJtg4MvGr
