The Bank of England has to avoid two ditches. On one side of the road is the ditch of high inflation. With UK inflation over 10% and the core at 6.2% the BoE is trying to fight off deep rooted inflationary pressures, so it has to keep hiking rates. On the other hand the BoE … Read more
In their last rate meeting the Bank of Canada highlighted their confidence that inflation was falling. However, they did see that core inflation was stickier globally and that the service sector was showing persistent price pressures. See here for details on their last meeting. CAD reaction to Canadian inflation data from April 18 On April … Read more
On Thursday the Bank of England meet and they are faced with a tough decision. In an ideal world they want to be able to signal to markets that inflation is under control and that perhaps the BoE do not need to hike interest rates any more. The problem is that inflation in the UK … Read more
Well, at least that is the view of some fund managers in a recent Bloomberg article from JPMorgan, UBS, & Morgan Stanley who favour a move back into bonds now. Here is their logic.Firstly, they cite that high grade dollar bond yields exceed dividend yields of companies in the Morgan Stanley Capital International’s All Country … Read more
Bloomberg recently wrote a helpul piece summarising reasons why professional investors think the USD may be weaker going forward. This is due to the Fed reaching the peak in their rate cycle, the strength of the yuan and the JPY, as well as potential de-dollarization trend that could accelerate over the next decade. The Fed … Read more
Early in the European session the euro and UK PMI’s are being released on Friday. This could present a good opportunity on the EURGBP pair if we see a divergence on the print between the two. The EURGBP has seen some falls this week already on increasing expectations that the BoE will need to be … Read more
From a seasonal perspective stocks tend to do well in April. Over the last 25 years April has been the strongest month for the DAX, and the FTSE, as well as one of the strongest months of the year for the S&P500. So, April tends to be a great month for stocks. See the seasonal … Read more
Short interest is the selling of a security that the seller does not own. It can be strange to think, ‘how can I sell something I don’t own’. However, this is how it works: You borrow shares of a stock from a broker and sell them on the open market. You hold the money you … Read more
Bank of Canada holds as expected at 4.50% Going into the Bank of Canada meeting it was not expected to be an eventful meeting, The Bank of Canada had indicated already they would be holding rates at current levels and there was no significant data prior to the meeting to indicate a shift from that … Read more
The problem for many regional banks in the US has been highlighted recently from a Brownstone research note. In the note the author points out that many US banks are still offering very low interest rates for depositors. Despite the Fed having hiked rates to nearly 5% the national average for banks offering interest rates … Read more
