Hard Currency

A fall in the yuan’s daily fix to a five-year low has the market wondering whether China is heading for another bout of currency devaluation jitters. Paul McNamara of GAM tells Roger Blitz that a strong dollar is bound to cause problems for China, but not on the scale of previous episodes of FX volatility.

 

You thought dollar weakness was here to stay? Think again, Société Générale’s Vincent Chaigneau tells Roger Blitz, as market assumptions are once again turned on their head. Don’t assume, however, that a strong dollar means a weak yen and don’t be surprised if China currency concerns resurface.

 

Markets used to take political risk in its stride – not any more, says Ousmene Mandeng of New Sparta Asset Management. He tells Roger Blitz why markets have become so sensitive to Brexit, Trump and other geopolitical events

 

Bad news is good news, HSBC’s David Bloom tells Roger Blitz, as a weak dollar and Federal Reserve caution opens up the currency market to a risk-on, risk-off climate. But when does bad news become bad news?

 

Two central banks held firm this week. But while the Bank of Japan’s grip on its currency slipped, Federal Reserve chair Janet Yellen stayed very much in control of the dollar, as Derek Halpenny of Bank of Tokyo Mitsubishi explains to Roger Blitz.

 

Sterling and the euro are moving one way then the other in rapid order. Charles St Arnaud of Nomura tells Roger Blitz how FX moves are becoming very short-term, as investors fret about holding positions for too long.

 

A breathless rally in emerging market FX begs the obvious question: will it last? Claire Dissaux of Millennium Global Investments tells Roger Blitz what will influence the rally and which parts of EM look more attractive than others.

 

When will the Bank of Japan say enough is enough on this yen rally? BNY Mellon’s Simon Derrick discusses the big dollar pullback with Katie Martin and explains which buzzwords from Tokyo matter.

 

Federal Reserve Janet Yellen is becoming more dependent on the market than data in determining monetary policy. Steven Barrow of Standard Bank tells Roger Blitz why that’s not a good idea.

 

Market turmoil has given way to market calm. Is it down to a currency wars truce, and how long will the calm hold? Adam Cole of RBC Capital Markets tells Roger Blitz it won’t last.