Emerging Markets FX: The Framework of Opportunity

  By Torrie Callander, CFA & Canberk Yalcin   Emerging Market (EM) currencies have already regained much of the ground lost in H1 2020. We therefore expect a more heterogeneous set of factors to drive opportunity in 2021, as opposed to any homogenous, broad-based EM recovery. Traditional factors such as carry, value and growth should …read more

We’ll have a (not so) Blue Christmas without you, Trump

Summary In the quiet after the storm, this blog post hopes to take stock of what happened in the US election, why markets were surprised, what the results means for US policy (fiscal, monetary, foreign, climate) going forward, and the implications of this for US and global growth, equities and FX markets. What happened? The …read more

FX as a source of return: Is now the time to look again?

  The global trend towards lower interest rates, exacerbated by the COVID-19 crisis, has led to an environment of suppressed yields and asymmetric risk such that traditional investments no longer offer the most efficient avenue to express macro views. Currency markets can act as the last great equilibrator when it comes to levelling-up asset valuations, …read more

Dollar Dominance in the Age of COVID

This article was co-authored with Dominique Dwor-Frecaut (bio below). This article can also be found on the Macro Hive platform here. Macro Hive is a leading producer of macro and financial market research and strategy.  The virus has catalysed more, perhaps, than it has caused. Established trends in geopolitics, economics, financial markets, public policy, and social …read more

COVID-19 and Currency Risk

From 2008 to COVID-19, currency market volatility trended down. Volatility was elevated in 2015-2017 after its 2014 record low (measured by CVIX), but this fit within the trend, as December 2019 levels tested the previous record. This trend can be attributed to: convergence in the drivers of currency value like growth and inflation aligned monetary …read more

Modern Monetary Theory: it’s a currency question

Modern Monetary Theory (MMT) is a political reaction to the constraints and costs of private financing for public spending. It is the explicit position that fiscal policy and monetary policy should be coordinated in order to avoid these constraints and costs. History is relevant. The future is untold. Money is currency is money. I hope …read more