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’Dollar meltdown
This is getting a bit much, isn’t it?
The dollar suddenly lurched down across the board on Thursday.
First, cable flying past $1.60 (all charts via Reuters):
While the euro settled down to life after $1.40:
A yen for history
‘I can’t go on. I’ll go on’. That would appear to be the Bank of Japan’s Beckettian motto, as the yen hit a 1995 high against the dollar with no intervention in sight on Thursday (chart via Reuters):
We’re well under September’s Y82 intervention level now.
A hold-out in the devaluation wars
Schwing! As they might be saying at European Central Bank HQ:
That’ll be the euro sauntering past $1.35 at pixel time, marking the single currency’s strongest position against the dollar since just before Europe’s sovereign debt crisis sent it tumbling in April.
The renminbi’s release is speeding up
Now here’s a renminbi mystery.
Not only did the People’s Bank of China fix the USDCNY cross-rate lower for the eighth time running on Monday at 6.7110, versus Friday’s 6.7172 — the longest run of low fixes since October 2007.
What next for the yen: ‘A lot of fake movements’
Here’s the latest on Tokyo’s long promised (or should that be, threatened) intervention in the FX markets, as of about 6pm Tokyo time (10am BST).
The Bank of Japan is said to have sold a total of about $11-$12bn worth of yen into the market on Wednesday to buy dollars,
Guest post: Michael Stumm on FX trading leverage
The chief executive of OANDA, Michael Stumm, discusses the recent US regulatory crackdown on outlandish leverage ratios offered to currency speculators.
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The Dodd-Frank Wall Street Reform and Consumer Protection Act as signed into law on July 21st of this year,
Adventures in FX intervention
Now, even by Japanese central banking standards, this… is weird.
Via Citigroup’s FX wire on Wednesday:
Apparently, the BoJ has been carrying out what a colleague calls “mock dry runs/drills in intervention”
The politics of (yen) intervention
With the S&P 500 up nearly 4 per cent in two days, commodities prices firming, better-than-expected economic data, and core bond prices under pressure, some analysts are (already) seeing a rebound in risk appetite.
Intervention threats — the never-yending story
Will they, won’t they - and would it matter either way? These are the key (yen-related) questions of the day, or indeed, the month.
Japan’s signalled (with slightly more feeling this time around) that it might – really,
Moody’s tires of Hungary, Hungary tires of austerity
Yet more evidence that Hungarian politicians’ careless talk costs, uh, currency — Moody’s placed Hungary’s Baa1-rated government bonds on downgrade review Friday in response to failed IMF talks.
Moody’s reckons a one-notch cut is most likely,
Swiss intervention, exiting stage left
Is the Swiss National Bank throwing in the towel on EUR/CHF intervention?
IFR Markets’ Divyang Shah thinks so:
The SNB has given the green light to tolerating further CHF strength by dropping the reference to intervention in their latest monetary policy assessment.
The dollar shortage in one easy graph
BIS academic Stephen Cecchetti has been much exercised by the currency costs of international financial integration lately — quantifying the yen carry trade.
And now he’s taken another look at dollar shortages.
What is a ‘basically stable’ renminbi?
The superior man is modest in his speech, but exceeds in his actions.
- Confucius, The Analects, Chapter IV
China’s leaders have long been known for their pragmatically gnomic political sayings.
Say thank you to MiFID
You can thank MiFID for this (click to enlarge):
This retail FX operation, FxPro, purports to offer its clients 500/1 leverage. So if you put up $2k you can trade $1m – just like a professional.
Retail FX hustlers await their fate
On Monday, the CFTC will issue its decision on leverage caps in the forex punting business. It’s a make or break moment for all those firms that offer margin trading to those wanting to play currency pairs.
A little Credit Suisse FX mystery…
The name Alain Delelis was being pinged around forex dealing desks on Thursday.
He’s the head of FX for the Americas at Credit Suisse.
Correction: he was head of FX for the Americas at Credit Suisse. A CS spokesman in New York confirmed that Mr Delelis has given up his management responsibilities,
Creative market manipulation
Okay, this is really sly. Let’s refer to the SEC’s specimen (alleged) heist to give a flavour…
16. AmeriServe Financial Inc. is a publicly traded, Johnstown, Pennsylvania based bank. The company’s shares are traded on the NASDAQ Global Market under the symbol ASRV.
Sterling: vampire squid really quite confident
…in the long term.
Amidst an analyst note on the difficulties of measuring fiscal policy impacts on exchange rates, Goldman has weighed in on the Great British Krona. Good news, sterling: the beatings will stop.
More from the ‘save our leverage’ coalition
As reported earlier on FT Alphaville, the CFTC is cracking down on the US retail forex market in a big way.
As well as publishing proposals to license all off-exchange retail operators — which the industry broadly accepted as ‘fair enough’ — the regulator unexpectedly announced it wanted to curtail leverage extended to clients to 10:1.
Save our FX leverage!
Pop quiz, FX hotshot.
There’s a bomb in your market. Once your position hits 200:1 leverage, your trade is armed. If your trade drops below your stop-loss, it blows up. What do you?
In an action film,
Citi sells its electronic FX platform
There’s been some consolidation in the world of FX electronic trading platforms on Monday.
According to a statement released by foreign-exchange platform FXall, Citigroup has reached an agreement with the company to sell it its LavaFX foreign-exchange electronic trading platform for an undisclosed sum.
Have you been forexed?
From our pixelated post bag, concerning that $100bn forex hustle:
I read your story with great interest. I traded equity indices and FX very actively at the end of last year/ early this year with one of the big UK cfd firms,
The $100bn FX hustle
$100bn — that’s the daily figure for trading volume in the retail foreign exchange market, where amateur plungers play the dollar and the like.
The IPO prospectus for Gain Capital, one of the scores of firms tapping into this area of explosive growth,
Intervene or do not intervene, there is no try
World war. Cold war. Terror war. Star wars. Global FX wars! Welcome to the search for the new global supreme currency – or perhaps a basket of trade weighted indexed currencies.
Indeed, what began as the race to devalue has begun to irk those bearing the brunt of appreciation on the other side.
Mrs. Robo Jones starts to make an FX impact
We’ve written about the shifting dynamics in the world of retail forex trading before. In particular, the phasing out of ‘Mrs. Watanabe’ in favour of ‘Mrs. Robo Jones’ — the western-based punter seeking returns in a zero-rate environment,
Lex: How to break a currency peg
The conventional wisdom is that Latvia, like all countries with pegged exchange rates, cannot devalue. If it did, the cost of its foreign currency borrowings would rocket; private borrowers would go bankrupt.
The undervalued pound, redux
Add Merrill Lynch – and a host of fund managers – to the list of those calling a significant overshoot in the sterling sell0ff. The following from their fund manager survey, out today.European currencies continue to get cheaper in the view of our panellists.