Please select your home edition
Edition
YY.com app (top)

Collinson FX: January 21, 2020 - Boris leads Brits on Trade Deal hunt

by Collinson FX 21 Jan 11:58 GMT 22 January 2020
Ben Saxton & Nicola Boniface (GBR) reach for the sky - Medal Race - Nacra 17 - Hyundai Worlds, December 2019 © Richard Gladwell / Sail-World.com

Collinson FX: January 21, 2020 - Brits go on Trade hunt

Markets reached for further record highs, as US markets holidayed, celebrating Martin Luther King. World leaders gather in Davos for a global forum. It is another massive gathering of elites to prance the world stage and accomplish very little. Surprisingly the President of the USA will attend and his address will be worth the entry fee, alone!

He will cause controversy, but he will advertise the huge progress the US economy has made and highlight policies of low tax, deregulation and bi-lateral trade agreements. The AUD fell back to 0.6865, while the NZD attempted to hold 0.6600, in the face of a rising reserve.

The UK PM, Boris Johnson, held an African forum in Britain, which sets the table for economic and trade ties with African nations ahead of Brexit. The PM will use Davos to establish relations with priority countries, that the UK will target for trade agreements. High on the list is the USA and Commonwealth nations.

The GBP attempted to hold 1.3000, in the face of a strong Dollar, while the EUR slipped below 1.1100. The USD operates at a substantial premium and will therefore continue to dominate.

Collinson FX: January 17, 2020 - US markets surge to record levels

US markets continued to surge in to further record territories, supported by the surge in global sentiment, resulting from the ‘Phase One’ trade agreement between the US and China.

President Trump signed the agreement which allows the US to increase exports to China by $200 Billion over two years. The other key components of the agreement is addressing IP transfers, financial services de-regulation in China and currency manipulation. The Fed released an important measure of the US economy, in the ‘Biege Book’, which confirmed modest economic progress and did not indicate any changes in monetary policy. US Retail Sales increased by 0.3%, in line with estimates, while the Philly Fed Survey showed large improvements.

The EUR was steady, trading around 1.1130, while the GBP jumped to 1.3070, as Brexit fast approaches. German CPI was steady, holding at 1.5%, hinting at slightly better growth numbers, coming down the pipelne.

The US/China trade agreement was a boost to the trade exposed commodity currencies, with the NZD pushing up to 0.6630, while the AUD posted initial gains but suffered in overnight trade. The AUD fell back below 0.6900, as markets consider the impact of the ‘bush fires’ on the economy and the prospects of further interest rate cuts from the RBA, to compensate.

Markets look set to ride the wave of positive sentiment, triggered by the fall-out from ‘Phase One’ US/China trade agreement, to close out the week.

Collinson FX: January 16, 2020 - Big win for Trump Administration

A huge victory for the Trump administration in the signing of the Phase One US/China trade agreement. This agreement signals a massive reform in world trade, where trade agreements will dictate US/China trade relationships, rather than the unbalanced WTO. Included in the agreement are an increase in US exports and regulation over IP transfers and currency controls. This is a massive victory for the US economy and also for global markets. Some certainty returns to the international supply chain, which should boost sentiment. The trade agreement was welcomed by markets, with US equities charging once again into record territory, while gold and oil prices continued to drift off.

The US Dollar drifted off, after direct criticism from President Trump of the Fed’s monetary policy. Trump indicated that the US Dollar was strong and supported by high interest rates, relative to their major trading partners. The US Dollar is supported by the interest rate differential, while in Europe interest rates are negative, reflecting a huge contrast. Key economic advisor to the Trump administration, Larry Kudlow, also announced tax cuts coming later in the year. This will be a massive boost to the already robust economy.

The softer reserve allowed the AUD to consolidate above 0.6900, while the NZD held 0.6600. The US/China trade agreement will be a boost to these trade exposed nations and currencies. There is not a great deal of local economic data being released this week, so the currencies remain exposed to international data and events.

Catch the new look Collinson FX website at www.collinsonco.com

Disclaimer: The details expressed in this website and accompanying documents or transmissions are for information purposes only and are not intended as a solicitation for funds or a recommendation to trade. Collinson Forex Ltd accepts no liability whatsoever for any loss or damages suffered through any act or omission taken as a result of reading or interpreting any of the information contained or related to this site

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

Related Articles

Collinson FX: August 5 - Global equities climb
Australian downturn not as bad as expected, but Victorian lockdown has a ‘major impact' AUD trading up to 0.7150, while the NZD tests 0.6600 on the downside. RBA Governor said that the economic downturn was not as severe as originally feared, but warned the Victorian lockdown was having a ‘major impact'. Posted on 5 Aug
Collinson FX: July 31 - US GDP drops like a rock
Pandemic impact on global economies is dramatic and none more so, than growth numbers and inflation. The pandemic is a big threat to economic re-opening and progress. The impact on global economies is dramatic and none more so, than growth numbers and inflation. US GDP contracted a shocking 32.9% for the June Quarter! Posted on 31 Jul
Collinson FX: July 22 - EUR agrees 7 year budget
EU passed a massive bailout/stimulus package, after a record five day meeting The EU passed a massive bailout/stimulus package, after a record five day meeting and heavily contested negotiations. The EU agreed to a EUR$750 Billion bailout, which is a heady mix of grants and loans to members heavily impacted by the pandemic. Posted on 22 Jul
Collinson FX: July 9 - Sanctions likely on China
The US, UK , Australia and other European nations look set to stand up to China The China situation is simmering, as their aggressive muscle-flexing in the region, attracts a more unified response. The US, UK , Australia and other European nations look set to stand up with various sanctions on China, to deter their behaviour. Posted on 9 Jul
Collinson FX: June 30 - Markets shrug off numbers
The AUD trades around 0.6850, while the NZD attempt to hold 0.6400, in the face of a rising reserve. The economic data is coming off record lows, reflecting the various re-opening of economies, across the world. NZ and Australian infection levels re-emerged, contradicted the narrative of ‘defeating the virus' Posted on 30 Jun
Collinson FX: June 24 - Turnaround in Australia
NASDAQ surged to new record highs, boosted by stronger PMI data in Europe, Australia and the USA. The NASDAQ surged to new record highs, boosted by stronger PMI data in Europe, Australia and the USA. The Dollar continued to drift lower, with the EUR rising to 1.1300, while the GBP broke back above 1.2500. Posted on 24 Jun
Collinson FX: June 16 - Chinese spike starts scare
Chinese cases spiked up and fears over a second wave swept Asian markets, which flowed through to EU NZ and Australia have achieved ‘control and containment' of the virus, but they remain vulnerable to fears over a ‘second wave', while exposed to China trade repercussions. Posted on 16 Jun
Collinson FX: June 11 - Riots distract from China
The NZD spiked to 0.6570, following the Fed's announcement, while the AUD rallied strongly to 0.7050 Markets are caught in a short term economic euphoria, with the re-opening of global economies, but significant risks remain. Posted on 11 Jun
Collinson FX: May 29 - Massive Bull run underway
Markets have been on a massive bull run, ignoring the Chinese threat to global trade Markets have been on a massive bull run, ignoring the Chinese threat to global trade, reinforcing the prospect of a ‘V' shaped recovery. Global economic data has been so historically bad, it can only get better, supporting market moves. Posted on 30 May
Collinson FX: May 22 - Economies open successfully
The NZD fell back to 0.6115, while the AUD slipped to 0.6560, damaged by extremely weak flash PMI Markets drifted lower overnight, after posting record gains during a strong week supported by ‘vaccine progress' and Central Bank support. Economies across the world are re-opening successfully, without any major outbreaks in the coronavirus. Posted on 22 May