News & Insights

June 2021 Monthly Market Commentary: Strong global economic data despite Covid variant threat

The overall global macro environment remains positive for risky assets in general and equity markets in particular. We believe financial markets are benefiting from three main factors: first, the progressive reopening of economies, country by country, which will underpin economic growth and corporate earnings; second, the fact that inflation is most likely temporary; and third, central banks’ accommodative monetary policy, which will continue to support the economy in the foreseeable future.

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Weekly FX Commentary June 16, 2021: USD edges up amid increased inflation 

Several key inflation figures were announced last week. China’s May inflation rate came in lower than expected on Wednesday. By contrast, inflation readings in the US, announced on Thursday, increased at a faster rate than the market anticipated, with US headline inflation at 5.0% YoY and US core inflation at 3.8% YoY. As a result, the USD appreciated against major currencies as market expectations of Fed tapering increased.

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Weekly FX Commentary June 08 2021: Upside pressure on RMB remains strong amid global recovery 

Albeit lower than expected, China’s trade surplus further increased in May according to yesterday’s official announcement, as China continues to benefit from strong global demand.

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May 2021 Monthly Market Commentary: Biden’s massive new spending plan to fuel the reflationary trend

In May, the market’s risk-on sentiment was supported by the gradual global economic recovery – country by country – as well as better-than-expected corporate earnings. Meanwhile, central banks confirmed their near-zero short-term interest rate policy, a key factor to maintaining the high price level of stock markets in the West.

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Weekly FX Commentary June 01, 2021: Biden’s 6 trillion budget proposal further weakens the USD

Yesterday, People’s Bank of China (PBoC) raised the reserve ratio requirement for foreign exchange from 5% to 7% in an attempt to curb the yuan’s appreciation. Although this will reduce the supply of US dollars and other foreign currencies onshore China such as EUR & JPY, it is unlikely to have a lasting impact on the ongoing USDRMB bearish trend.

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Weekly FX Commentary May 26, 2021: Strong US PMI data has limited impact on USD

Last Friday, US Purchasing Managers’ Index (PMI) readings for May came in higher than expected although this provided temporary support to the US dollar against other major currencies, however, USD gains proved short-lived.

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