Collinson FX Commentary: Mar 1

Collinson FX Commentary: Mar 1 - US in growth mode

by Collinson FX 1 Mar 2018 05:04 PST 2 March 2018

Day 2, Bay of Islands Sailing Week, January 25, 2018 © Richard Gladwell

Collinson FX Commentary: Mar 1 - US in growth mode

Markets continue to respond to the new Fed Chair, Jerome Powell, in his recognition of the economic situation. The US economy is in a growth mode, as the equity markets bull-run recovers the 10% correction, further strengthening the rally. Interest rates are rising and the recognition of the economic recovery is reflected in the Fed Chairs' appearance in front of Congress. Powell cited the strong economy and iterated that the Fed will raise rates, at least three times, this coming year. It is important to note that the US has responded to the Trump administration and their growth strategy.

Contrast the European situation, with static inflation, growth and employment. They have moved from the mire of the GFC, but socialism does not provide the environment for a strong recovery, reflected in the latest employment and consumer confidence data. The EUR fell to 1.2200, while the GBP crashed, trading below 1.3800. Commodities remain in demand, but the rising reserve has tempered currency gains.

The AUD fell below 0.7800, while the NZD is testing 0.7200, on the downside. The USD has been reinforced by rising rates and a strong economy.

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Countries: | NZ: 0800 338 838 | AU: 1800 143 415 | NY: 1888 6257 833 | UK: 0800 0285 834 |

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