Archive for December, 2015

FX

Monday, December 14th, 2015

Via Marc Chandler at Brown Brothers: Drivers for the Week Ahead - After much hemming and hawing since mid-year, the Federal Reserve is finally poised to raise rates for the first time in nearly a decade - The Fed's dot-plots, which we argue has a high noise to signal ratio, may be particularly ...

Where is the Inflation?

Monday, December 14th, 2015

This article from the WSJ recounts the angst of global central bankers as inflation consistently runs below target globally. Via the WSJ: By Josh Zumbrun Updated Dec. 13, 2015 8:36 p.m. ET Federal Reserve officials this week are expected to raise interest rates for the first time in nine years on the expectation ...

UK Credit Ratings

Monday, December 14th, 2015

Via Reuters: Two credit rating agencies said on Friday that Britain risked a hit to its creditworthiness and possibly a downgrade due to Prime Minister David Cameron's decision to hold a vote on whether to leave the European Union. Shortly after the International Monetary Fund said the referendum could hurt Britain's growth ...

Early FX

Monday, December 14th, 2015

Via Kit Juckes at SocGen: <http://www.sgmarkets.com/r/?id=hf593cb9,1529632b,1529632c&p1=136122&p2=eb41fec1bbacd92b510910876abd6f1b> The news on Friday that Third Avenue Management is winding up its ‘Focused Credit Fund' prompted plenty of parallels with the closure of mortgage-backed credit funds ahead of the financial crisis in 2008. A decade ago, easy money was fuelling a surge in mortgage lending and ...

Fear and Loathing in Junk Bond Land

Sunday, December 13th, 2015

Via the WSJ: By Matt Wirz, Mike Cherney and Corrie Driebusch Dec. 13, 2015 8:27 p.m. ET Traders and regulators have fretted for more than a year that mayhem might ensue if U.S. mutual funds sought to sell rarely traded bond investments. After junk-bond prices posted their largest drop since 2011 on Friday, investors say ...

Treasury Flow

Sunday, December 13th, 2015

One dealer reports that central banks have been much better sellers of the 5 year sector this evening (morning in Asia ) and trading accounts have been unwinding 5s 30s flatteners.

Feeling the Pain

Sunday, December 13th, 2015

Via the FT: 9 hours ago by: James Kynge If, as widely expected, the US Federal Reserve tightens monetary policy this week, emerging markets are likely to feel the pain. Analysts say pressure on EM currencies is set to intensify, more capital may flow out to safer havens and debt service costs may rise ...

Hilsenrath Article: What Goes Up May Quickly Come Back Down

Sunday, December 13th, 2015

No that is not a double entendre by me or Mr Hilsenrath who has written an interesting article about concerns that we may quickly end up back at zero. Via Jon Hilsenrath at the WSJ: By Jon Hilsenrath Updated Dec. 13, 2015 7:16 p.m. ET Federal Reserve officials are likely to raise their benchmark ...

Illiquidity Trap

Sunday, December 13th, 2015

Via the WSJ: By John Carney Updated Dec. 13, 2015 3:22 p.m. ET The debt world is haunted by a specter—of a destabilizing run on markets.   Last week, this took on more form even if there weren’t concrete signs of panic. Only one mutual fund manager, Third Avenue Management, has said it would halt ...

Russia Does Not See Significant oil Market Recovery

Saturday, December 12th, 2015

Via Ambrose Evans Pritchard at the UK Telegraph: Click the above link for the charts which accompany the article. By Ambrose Evans-Pritchard 3:43PM GMT 11 Dec 2015 Russia is battening down the hatches for a Biblical collapse in oil revenues, warning that crude prices could stay as low as $40 a barrel for ...