Collinsonfx Weekly Marketing Commentary and Calendar

Weekly Market Commentary

A negative close to a volatile week on global markets. Markets were dominated by political machinations in the USA, highlighted by the largest militarized inauguration, in the history of the country. The split in the country is even more defined now and the questionable election was exemplified, with the need for more than 30,000 troops to inaugurate the President, with no public attendance outside of family, friends and politicians. This will lead to a lack of political capital in the years ahead, despite Democrat control over the House, Senate and Presidency.
 
The Obama third term will increase taxes and regulation, growing the Government and testing the private sector. The administration has is in the process of undoing much of the Trump administration policies, through Executive Order and will attempt to pass a massive $1.9 Trillion stimulus bill. This will deliver a fleeting sugar hit to the economy, but worrying data points to tough times ahead. Deficit and debt is now a thing of the historical past, with 'Modern Monetary Policy', driving interest rates to below zero, while using this as an opportunity to ramp up reckless fiscal largesse. This new policy will have enormous economic and social repercussions, as reality bites.
 
The Dollar measurement is relative and coordinated Central Bank expansion, has ensured that currencies strive to undermine each other. The real measure is against hard assets. The EUR traded 1.2170, while the GBP attempted to regain 1.3700, amidst gloomy economic data driven by lock-down programs across Europe. Commodity currencies are beneficiaries of rising prices, with the AUD back above 0.7700, while the NZD pushed up to 0.7170. These currencies are beneficiaries of a weaker reserve, but remain extremely vulnerable to testing economic performance and global trade challenges.

Weekly Market Calendar

25/1 German IFO Business Climate, Chicago Fed National Activity
 
26/1 Australia Day Holiday, Dallas Fed Manufacturing Index, NZ Services PSI, Bank of Japan Minutes, NZ Credit Card Spending, Japan Employment
 
27/1 S&P Case Shiller Home Price Index, US Consumer Confidence, Richmond Fed Manufacturing Index, Australia CPI, US Consumer Confidence, France Consumer Confidence, US Weekly Mortgage Applications, US Durable Goods Orders
 
28/1 FOMC Rate Decision, NZ Trade Exports/Imports, Japan Retail Sales, EU Consumer Confidence, German CPI, US GDP, US Weekly Jobless Claims
 
29/1 US New Home Sales, Kansas City Fed Manufacturing Index, NZ Consumer Confidence, Japan Employment/CPI/Industrial Production/Construction/Housing Starts/Consumer Confidence, France GDP, German Employment, German GDP, Chicago PMI, University of Michigan Economic Sentiment