ONE-TWENTY TWO: Trading Financial Markets
Exploring the poetry in financial markets for students of money and economy since the year 2000.
In the wake of poor inflation data, a rate cut from the Reserve Bank of Australia (RBA), and then a dovish Statement on Monetary policy, speculators decided that this was not the time to have such a large net long exposure to the Australian dollar (FXA). Source: Oanda’s CFTC’s Commitment of Traders Roll forward to … Read more
Last week, the Australian dollar (FXA) was slammed by poor inflation data. Market expectations for a rate cut strengthened significantly as well. This week, the Reserve Bank of Australia (RBA) took heed and cut its cash rate from 2.0% to 1.75%. In its statement on the monetary policy decision, the RBA explained that its decision … Read more
“The Australian dollar has appreciated somewhat recently. In part, this reflects some increase in commodity prices, but monetary developments elsewhere in the world have also played a role. Under present circumstances, an appreciating exchange rate could complicate the adjustment under way in the economy.” – Statement by Glenn Stevens, Governor: Monetary Policy Decision, April 5, … Read more
(This is an excerpt from an article I originally published on Seeking Alpha on March 8, 2016. Click here to read the entire piece.) On March 1, 2016, Glencore (GLNCY) announced its preliminary 2015 earnings results. During a media conference call, CEO Ivan Glasenberg declared a bottom for commodities. In the subsequent investor/analyst conference call, … Read more
The Reserve Bank of Australia (RBA) rolled out the copy and paste machine for its December statement on monetary policy. I found just two snippets of differences from the November statement that are worth noting: This time around, the RBA fingered weaker demand as a driver of lower commodity prices. In the last statement, supply, … Read more
(This is an excerpt from an article I originally published on Seeking Alpha on November 19, 2015. Click here to read the entire piece.) “…the changing nature of China’s development implies that the potential for commodity prices to rise from here is somewhat limited.” – Christopher Kent, Assistant Governor, Reserve Bank of Australia (RBA) at … Read more
The Reserve Bank of Australia (RBA) announced its November decision for monetary policy with a very familiar template. The most important part of the statement came at the end where the RBA made it clear rate cuts are on its collective mind (emphasis mine): “At today’s meeting the Board judged that the prospects for an … Read more
(This is an excerpt from an article I originally published on Seeking Alpha on October 1, 2015. Click here to read the entire piece.) {snip} RBA Governor Glenn Stevens found a clever way to imply that the decline in the Australian dollar (FXA) still has a ways to go. First, he implied that the terms … Read more
(This is an excerpt from an article I originally published on Seeking Alpha on September 1, 2015. Click here to read the entire piece.) The Reserve Bank of Australia (RBA) delivered another plain vanilla decision on monetary policy. The RBA barely even acknowledged the stomach-churning volatility of the past two weeks or so. {snip} Markets … Read more
(This is an excerpt from an article I originally published on Seeking Alpha on August 4, 2015. Click here to read the entire piece.) {snip} The Reserve Bank of Australia (RBA) issued its monetary policy decision for August. The RBA left rates unchanged just as the market expected. The rest of the statement was boilerplate … Read more