Collinson FX Market Commentary - Oct 21 - The calm before the Storm

by Collinson FX on 2 Oct 2015 Collinson FX Market Commentary -Oct21 - The calm before the Storm Click here to find out how to get Collinson FX's free iPhone app

Oct 2 - The calm before the storm! The new quarter brought little in the way of hope, due to economic transition, allowing a consolidation and reprieve. The irritant Tankan report in Japan gave little away, in terms of any sort of Asian recovery, it failed to give any real direction. Chinese Manufacturing was flat, confirming the global slump, pushing commodity currencies.

The AUD consolidated above 0.7000, while the NZD approached 0.6400, both watching any directional impact from the reserve currency. European markets remained diverted with the EUR falling to 1.1180, while the GBP traded 1.5125, both confused by weak economic fundamentals.

Jobs remain an issue in the U.S. but it seems little can move the Fed, while the ECB looks to expand monetary expansionism. Why not, the Fed has achieved so much, pushing asset bubbles?

Collinson FX Market Commentary - Oct 1 - Month ends on rebound
Oct 1 - Global equities staged a dramatic recovery to close the month and the quarter. It ends a terrible month for equities and commodities, which have been hit hard, with lack of Chinese growth triggering lower demand.

The Dollar jumped as the ECB threatens to further enlarge QE, in the face of contraction, with CPI going negative. The EUR slipped to 1.1175, while the GBP traded 1.5130, after some steady GDP numbers. Share markets will be glad to see the back of the September quarter which has been highlighted by weaker demand and Central Bank control.

Commodities also experienced a rebound which pushed the associated currencies higher, the AUD back towards 0.7000, while the NZD is trying to regain 0.6400. Markets now look to the non farm payrolls number while keeping a close eye on the Middle East.

Collinson FX Market Commentary - Sep 30 - Market rumours of correction
Sep 30 - Markets were flat overnight, after a radical sell off in Asian equities, following European and U.S. Monday opens. Currencies remained in a state of flux, with the EUR trading 1.1240, while the GBP held 1.5150. Pending Home Sales contracted, while the S&P Case Shiller Home Price Index was flat.

The Dallas Fed Manufacturing Index continued to contract while markets remain extremely nervous. German CPI fell 0.2%, mirroring the EU number, which also contracted 0.3% This reflects the lack of growth in the much troubled Union. The Europeans remain preoccupied with the refugee flood and corporate malfeasance. Commodities stabilised, which settle the associated currencies, attempting to consolidate.

The NZD traded 0.6330, while the AUD remained below 0.7000, after Consumer Confidence dipped. There are many rumours hitting markets about a major correction coming as commodities flounder, through lack of demand, while corporates suffer earnings failures.

Growth and demand remain the primary ailment impacting Asia and spreading through the Global markets. The Feds lack of action confirms this scenario.

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