Macro Cheat Sheet

Oct 11 00:10 2018 Print This Article

Here is a succinct four-bullet summary of key considerations behind  six currencies:  

USD:

·  Rising US rates in absolute terms and relative to other countries, coupled with the policy-mix and US tax reform are the main drivers.

·  The market has nearly completely discounted three more Fed hikes by the end of next year, while the Fed has signaled that four hikes may be appropriate.

·  Despite the fiscal stimulus and robust economy, several headwinds are emerging, including trade, interest-rate sensitive sectors such as housing and auto sales, and the dramatic rise in oil prices--(100-day moving average has risen 30% since the start of the year. 

·  Midterm elections are unlikely to change the trajectory of US policy. 

Euro:  

The ECB has signaled it will not hike rates until at least the end of next summer.  In the meantime, it has reduced its asset purchases and will stop them entirely at the end of the year. 

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About Article Author

Marc to Market

Marc Chandler has been covering the global capital markets in one fashion or another for more than 25 years, working at economic consulting firms and global investment banks. Chandler attended North Central College for undergraduate work, where he majored in political science and the humanities. He holds master's degrees from Northern Illinois University and University of Pittsburgh in American History and International Political Economy. Currently Chandler teaches at New York University Center for Global Affairs, where he is an associate professor. A prolific writer and speaker he appears regularly in the press and has spoken for, and is an honorary fellow of, the Foreign Policy Association. In addition to being quoted in the financial press daily, Chandler has been published in the Financial Times, Foreign Affairs, and the Washington Post. In 2009, Chandler was named a Business Visionary by Forbes. In 2009, his book, Making Sense of the Dollar, was published by Bloomberg Press and received a Bronze Award from Independent Publishers.

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