SGM-FX insights

Rand   Volatility has been a feature of markets mid-2022 to date. Once the realisation finally struck that inflation was not transitory after all and the implications of Russia’s invasion of Ukraine became apparent assets that remained stable in value or price were few and far between. In a world characterised by such widespread inflation, […]

UK   Plenty of pundits talking about new PM Liz Truss needing to stamp her authority in the first 100 days which includes the Conservative Party Conference, the UK energy cap review on 1-10-22 and increased clamour on striking workers, inflation and cost of living as the country goes into winter. Those historians among our […]

South Africa   The Wild Coast in South Africa is in the Eastern Cape and extends 250kms from the border of KwaZulu-Natal in the North to East London in the South. A long and hard fought court battle between environmentalists and Shell has just concluded yesterday with Shell having their oil exploration license to drill […]

Chile   Not a frequent inclusion in the SGM-FX Daily Brief, Chile definitely deserves inclusion at this juncture in global macro events. Not just due to Russia but the world is making a dash towards sustainability, clean energy and non fossil fuel dependency. In order to do that non eco friendly activity will soar in […]

Eurozone Wildfires   The province of Zamora in north west Spain like many other parts of the Iberian peninsula has seen 40c temperatures over the weekend which has caused forest fires to break out and firefighters to be deployed. Elsewhere in the Eurozone, similar temperatures are being experienced in Paris and no doubt the aircon in […]

Emerging Market Meltdown   War as an economic event creates winners and losers. Theories of politics and economics suggest that there’s more losers than winners (on average by mode and mean) and in most episodes of at least recent history the world suffers economic and general setback as a result of it. Some currencies are […]

Half a percent   Over the past two decades, the norm for the size and frequency for interest rate adjustments has continued to fade. The tool most obviously available to central banks, the interest paid on deposits held at their institution, is now seen as the heavy touch option and accordingly even when it is […]

Emerging Markets   Take one glance at intraday currency moves and you’ll see that volatility is up in a noticeable and pervasive way. There are many expressions of risk in the foreign exchange market at present: the persistent and increasing strength of the US Dollar is symptomatic not just of the increasingly hawkish repricing of […]

Mixed picture   The Rand has had a dramatic recovery from the depths of its pandemic and risk induced sell-off running into March 2020. It may seem obvious that ZAR crosses no longer reflect the severe discount priced into them during the height of the market turmoil. However, there are many emerging market currencies who, […]

High Beta could turn High Volatility   With some US indices approaching correction territory amidst rising monetary and geopolitical uncertainty, it is unsurprising that markets are starting to question the valuation of many high-beta currencies. Taking a look, for example, at AUD and NZD currency crosses will reveal trading ranges that have exceeded four cents […]

Iran   The life of the Iranian drug smuggler can be short, brutish and complicated. Last week off the coast of Dubai when faced with interception by a US patrol boat, 5 Iranians set fire to their stash on board their vessel which unfortunately was a traditional sailing boat made of wood. Things did not […]

What goes down must not come up…   The case for a stronger South African Rand continues to grow in momentum. However, the spot (and indeed forward price) has been reluctant to follow. Why? First let’s make the case for a stronger Rand. Following municipal elections in South Africa, the risk of a major upset […]