SGM-FX insights

RCEP: Regional Comprehensive Economic Partnership   This new formed and largest free trade bloc globally was signed yesterday and includes the 10 countries that make up ASEAN-The Association of South Eastern Asian Nations plus China, Australia, New Zealand, Japan and South Korea. This is the bloc to strike deals with unlike the much heralded Trans […]

China Communist Party   Today is Day 3 out of the 4 Day meeting of the CCP and where the Central Committee will decide on the economic and social policy goals for the next 5 years. Announcements to watch out for: GDP goals– having missed the last 6.5% goal between 2016 and 2020, the question […]

8 – Lucky for some!   Not for others! Considered the luckiest number of all in China, the number 8 is a forbearance of prosperity and fortune. It’s pronunciation, ‘Ba’ is similar in sound to a word pronounced ‘Fa’, meaning to make a fortune. The belief in the good luck that the number 8 will […]

Turkish Lira   On top of its already well reported economic woes, the Turkish Lira is now being further marked down by fears that the clash in the Caucasus between Armenia and Azerbaijan risks drawing in Turkey-the conflict is the most serious since 2016. Turkey has already weighed in against the Armenians. Those market fears […]

Cost of caution   One of the most strict lockdowns imposed worldwide was in the nation of South Africa. The nation’s projected capacity to deal with a coronavirus outbreak lead to immediate and severe lockdown only days after the first coronavirus cases were first imported to the continent of Africa. A five-tier lockdown schedule was […]

Eastern Mediterranean   Turkey’s President Erdogan ramped up the pressure further on an already pressurised situation yesterday with threats to Greece. The issue is the oil and gas especially in the sea around Cyprus which clearly belongs to Greek Cyprus. Erdogan’s response to that is that he does not accept that ownership so he is […]

Turning Tides   The protests in Hong Kong, tensions between the territory and China, and the mainland and the United States in turn, all encouraged speculative flows out of the Hong Kong Dollar as investors raised the possibility of the USDHKD peg breaking. The tide has turned for the Hong Kong Dollar with the pair […]

Australian Unemployment and Exchange Rate Volatility   Like most countries, since March this year Australia has seen gyrations in the unemployment rate: in April at the then height of lockdown it reached 14%; by July this had fallen to 9%, but with further LockDown measures particularly in Melbourne, the expectation is for that number to […]

Thai Baht   With increasingly strident anti government demonstrations in Bangkok yesterday evening, concern is growing that Thailand is once again seeing unrest on a scale that matches the events in 2014 that resulted in a change of government and a coup. At the end of last year Thai Baht (THB) was trading around 30 […]

Data Sharing: India   The Indian government plan to regulate non personal data which will cramp the plans of Facebook, Amazon and Google in particular as they all view India’s 1.4 Billion population as a very enticing and juicy market. In short this will tighten up the rules on data transfer and US big data […]

Turkey: Short and Caught?   Being short of Turkish Lira will cost 1050% to borrow overnight in the offshore market as the local market has been drained following heavy state intervention executed through the state banks in the past week-probably more than $2.5 Billion taking the state $ sales to over $65 Billion. That Lira […]

TRY again!   The Rand, Brazilian Real, the Ruble and the Indonesian Rupiah join the Turkish Lira to form a basket of emerging market currencies that are particularly vulnerable to capital flight – the so-called “fragile five”. During the height of the pandemic this basket of currencies recorded heavy losses versus their G10 counterparts. Losses […]