Collinson FX Market Commentary - June 22 - Brexit swing spooks Brits
by Collinson FX on 22 Jun 2016
Giacomo - ANZ Fiji Race Start - June 4, 2016 Richard Gladwell
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Collinson FX Market Commentary - June 22 - Brexit swing spooks Brits
June 22 - The latest Brexit poll was a slight swing back to the 'leave' campaign, unsettling the GBP, which slipped back to 1.4660. Equities were mixed, globally, as all await the referendum result. Yellen made an appearance in front of the Senate Banking committee, but there were no new revelations, although her testimony does extend for another day. Draghi also made public commentary, reinforcing added QE, but markets are immune to this rhetoric.
The RBA released minutes, citing comfortable levels of growth and employment, thus relieving any pressure on further rate moves. This is highly unlikely in the heat of an election campaign. The AUD breached 0.7500 overnight, but settled back around 0.7470, driven by a drifting Dollar. The KIWI hit year highs, around 0.7169, but retreated back to 0.7150. All eyes remain on the UK vote, which will consume markets for the entire week, with the latest polls driving currencies and equities.
Collinson FX Market Commentary - June 21 - Brexit poll points to stay
June 21b - UK Brexit polls turned sharply over the weekend, surging in a reversal, leaning back to the remain campaign. This caused the biggest spike in the GBP in 7 years, jumping to 1.4670, relief obvious. Global equities all surged, as the status quo looks to have consolidated power, sending calming signals across markets. The safety play was reversed, with the Dollar slipping across the board, pushing the EUR up to 1.1300. The YEN remains in intervention territory, trading 103.90, testing the BoJs resolve?
Commodity prices regained some momentum, bolstering the associated currencies, pushing the NZD to 0.7100 and the AUD to 0.7450. This is a week where the referendum will dominate markets and change seems unlikely. The dire warnings and pressure internally and externally are overwhelming. Global Government is moving closer and rejection of nationalism is prevalent. Boris and his merry band gave a brave effort but looked to be vanquished. This gives some certainty to markets, but until Thursday, nothing is certain! You got to love the underdog! Go Boris!!
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