Officially the central bank will keep the 1.20 peg for the time being, which could be in fact a 2-year time span. The Swiss National Bank will be very hesitant to remove it too quickly mostly due to psychological reasons. I mean, while everybody knows that the central bank is buying the Euro at 1.20 francs, it effectively stops speculating
We have seen that the Euro moved back higher quite a bit over the last two months or so. The common currency has come from around 1.27 at the beginning of November and has gone up by 7-8% to 1.36. However, now we see that the Euro is doing a bit of correction. I think the movement up is justified
What happened on 22 January, was a significant shift in the monetary policy thinking at the Bank of Japan, and essentially, now it sees eye-to-eye with the current government. The Bank of Japan, being out of line with the government, was a substantial impediment to further Yen weakness, and we would have to wait for the Governor Shirakawa's term ending
Our forecast for EUR/USD is 1.36 and for GBP/USD – 1.60.
In my view, the Indian Rupee seems to be the most attractive at the moment, as it is offering the highest value in total return terms. I think the Rupee enjoys the following two aspects: pretty relevant carry and a potential appreciation against the U.S. Dollar, as the reform momentum, which started last September, is driven by the government decision
I do not have a big reason to disagree with it, as the Eurozone economy is still weak, the U.S is expected to grow 2% this year. The one I disagree with is the IMF the outlook for China. We forecast that China's growth will be 7,5% this year and 7% next year. It is very hard to see how
We have a positive view on gold, at least through the first half of 2013. This optimistic outlook is supported by what we perceive to be solid fundamentals, including a higher money supply growth from central banks like the BOJ or the Federal Reserve. In our opinion, the U.S. Dollar is going to weaken against other currencies on the Fed's
Yes, I do. I think that were definitely inflows last summer, particularly, when the European debt crisis spread to Spain, while still having a toll on Greek economy. However, as concerns the current situation, I believe we are seeing a reversal of some of those flows, which is also in line with EUR/CHF move higher.
Clearly an appreciating exchange rate is another headwind for Europe, which certainly the periphery of Europe would rather not have. However, I think it is not necessarily the most notable factor. To my mind, it is the case that we will see some further short-term support for the Euro, and we may as well find that the Euro potentially gets
At the moment, demand is in fact weak, but it is still rising. Thus, in 2013 we see tepid growth in global oil demand. There are two factors here: on the one hand, we are seeing declining demand from Europe (almost by 0.5mn b/d yoy in 2012), which is more due to the effect of fiscal austerity, and on the
I guess there is a bit more uncertainty surrounding the Australian economic outlook now. The money investment boom has probably peaked and we are a little bit unsure about how much support the RBA rate cuts have provided to the other parts of domestic economy. The question is still whether or not the RBA has done enough to stimulate domestic
In general, Danish growth has been absent for several years now, and the recovery out of the 2008 financial crisis has been very sluggish. That said, Denmark still enjoys, just like the rest of Scandinavia's countries, very healthy balances, marginal budget deficit, low debt levels and a positive current account - that all has mattered more for the currency market
Obviously, we have seen a slight change over the last couple of days. We have seen the Yen trading a little bit stronger against the Dollar and the Euro. I think that has got nothing to do with the BOJ yet, because that is more to do with some profit taking. The market is extremely short on Yen. We had
Dr. James Nixon, Chief European Economist at Societe Generale, shares his opinion on whether the European debt crisis is over and when we will see an improvement in the Eurozone labour market
It has been trading between roughly between 0.98 and 1.01 for the better part for more than 2 months now. There is no particular strong up or down trend in USD/CAD for the time being. However, I do think that there are risks that USD/CAD breaks down towards 0.97 in the coming weeks on the ground that the U.S. fiscal
The Sterling has become a difficult currency to predict largely because its fundamentals are a little awry. We had a series of very negative forecasts for the U.K. economic events during the autumn. However, things seem to change a little bit, and we have seen some positive data being released. I think the market has always been less incline to
I do not think it will last long. Perhaps, we have already seen the best part of it, especially on the FX side, where we saw a risk-on mood, with aussie and kiwi dollars gaining very much. This was something that I do not think will continue for a long time, because where the volatility is very low. Especially the
Professor Hendrik van den Berg discusses the chances of SDRs to become a new world's reserve currency as well as analyzes advantages and disadvantages of floating and fixed exchange rates
Dukascopy Bank always strives to provide its clients with the fresh and insightful ideas from world's leading academia experts. In this Expert Commentary piece Dukascopy shares the opinion of Professor Hendrik van den Berg on the International Monetary System.
Since the U.K.'s economy is emerging from the double-dip recession, do you expect the Bank of England to adopt a more hawkish tone in the future?No, I think at this stage we expect policy makers to continue to have a neutral bias to their monetary policy stance. They halted their quantitative easing programme in November, but the fact that they
The Norwegian economy is performing relatively well. Unlike a lot of other Nordic countries, Norway is rather unaffected from economic point of view of what is going on in the Eurozone, although developments are very split between sectors. The Norwegian economy is more operating as an oil-dependent economy. The activity in the oil and offshore sector is currently booming and
In the final part Professor David W. Conklin from Western University provides an insight into how to prosper in the Global Financial Storm.
Dukascopy Bank is proud to present a second part of the article by Professor David W. Conklin from Western University, which discusses China's and India's needs and the commodity cycle, while the final part will provide an insight into how to prosper in the Global Financial Storm.
Dukascopy Bank is happy to present an article by Professor David W. Conklin from Western University, which will be published in two separate parts. The first part is devoted to the overview of world's economic and financial stance, two possible scenarios of developments for the Eurozone, and the fiscal cliff in the U.S. The second part of the article discusses