SGM-FX insights

Local Elections – South Africa   Domestic elections in South Africa have arrived amidst an already challenging time for the South African Rand. Having failed to hang on to gains associated with the liberalisation of travel and commerce following the latest wave of pandemic-induced restrictions, the Rand entered this week’s elections vulnerable to selling pressure. […]

Saudi Arabia   Yesterday the Crown Prince kicked off the high stakes game of poker to establish Green credentials ahead of COP26 by pledging that Saudi Arabia will be carbon neutral by 2060. While there was a rush to welcome this news by COP26 luminaries, saner voices were heard to express doubt about KSA’s delivering […]

Sticky CNY   Uncertainty and risk continue to pervade and detract investors from Chinese stocks. In particular, investors continue to question whether the crisis within Chinese real-estate stocks will be contained within the sector or spread through the financial sector, deteriorating financing and economic conditions nationwide. Whilst stocks in the one of the world’s most […]

US Trade Deficit   The August surge of 4.2% took the deficit to $73.3 billion last month. This is a sure sign of economic growth slowing from an annualised rate of 6.7% in Q2 which is further confirmed by the Atlanta Federal reserve forecasting economic growth of just 2.3% for Q3. The market is remarkably […]

How Many?!   In case you were getting worried about the relative calm in foreign exchange markets, you might not need to fear for much longer. With as many as six central bank meetings this week, there is the potential for a whole host of chaos to play out in the foreign exchange market. A […]

Oil   With WTI at $63.28, it’s lowest level since May, oil prices yesterday marked the sixth trading session in a row when prices have fallen. It’s based on two factors: supply or in the market’s view potential over supply plus ongoing and non receding Covid infections threatening to derail the global economic recovery. Those […]

Global Happiness   Health and wealth plus freedom of life choices together with social support are the prime drivers for what constitutes happiness. And the happiest country in the world? Fun loving Finland, followed by Canada, Israel, Uruguay, USA, Norway, Sweden, Germany, Netherlands, Denmark, UK, Switzerland, Australia and New Zealand. At the other end of […]

The Wild East   Investors with especially strong constitutions looking for yield should take a deep breath then investigate China’s corporate bond market. More than $200 billion of debt has been issued by 80 property developers to finance China’s real estate market which accounts for 30% of the economy. 3 year debt currently yields 18%pa […]

Two-Speed Europe   It’s a phrase often linked to the two varying speeds of European integration between the core and periphery of the Union. Today, the most obvious mismatch within the EU is how quickly and severely post-pandemic inflation is affecting core versus peripheral economies. Monetary, economic, fiscal and political asymmetries have the capacity to […]

Antipodeans   There’s no doubt we’re in a widespread recovery phase from the global pandemic. With the exception of a handful of tail risks including viral variants, public adherence and seasonality, the global economy is rather steadfast in its pursuit of a post-Covid world. In accordance with that recovery comes a phase of increased risk […]

Bullseye   It was apparent recently that the Rand had managed to duck and dive between two huge risks to emerge relatively unscathed. When inflation statistics and an interest rate decision passed on two consecutive days accompanied by only mild and measured market fluctuations not dissimilar to a normal day’s trading, it appeared that both […]

Framing   The Rand’s appreciation over the past few months has been significant. Against a strong and still rising GBP, ZAR is one of only a small handful of currencies that has gained ground versus the Pound so far this year. One of the major risks that could have abated further Rand strength presented itself […]