The British pound got a boost in the Asian day as expectations that the U.K. would remain in the EU mounted after the Remain camp made advances ahead of Thursday’s referendum.
Around noon on Monday in Asia, the pound was up 1.7 percent at 1.4596 against the dollar, after gaining as much as 1.8 percent to 1.4611 earlier Monday. Continue reading
A surge in oil prices has buoyed he Australian dollar ahead of the UK’s Brexit referendum vote this week.
At 0700 AEST on Monday, the local unit was trading at 74.34 US cents, up from 73.79 cents on Friday.
BBH currency strategists said oil snapped a six-session fall before the weekend to surge by 4.2 per cent.
Prices are still up almost two per cent, which is helping the Aussie. Continue reading
Britain’s upcoming referendum on whether to quit the European Union has created considerable market volatility. According to one Wall Street firm, however, investors who panic and sell if the Brexit wins will do so at their own peril.
“If there is an exit vote, you know we want our clients in here stepping in to buy U.S. large-cap stocks,” Scott Wren, Wells Fargo Investment Institute’s senior global equity strategist, said recently on CNBC’s “Futures Now.” “After we get finished with the noise and the volatility, after a few weeks of that, you know people will have wished they bought stocks.” Continue reading
A Federal Reserve meeting and a referendum on the future of one of the world’s largest economies are set to whipsaw currencies and other assets, according to Pacific Investment Management Co.
A gauge of implied global foreign-exchange volatility jumped by the most in four months this week as traders cut the odds of an interest-rate increase by the Fed at its June 15 meeting. The pound extended a weekly drop and its volatility soared as the latest U.K. poll on the June 23 vote on Britain leaving the EU, conducted by ORB for the Independent newspaper, showed 55 percent “Leave,” 45 percent “Remain.” Continue reading
USD/JPY – NEUTRAL BIAS – (105.50-108.00)
The Fed and BoJ are likely to leave monetary policy settings intact next week, even though their meetings will still likely determine USD/JPY direction. The Fed is not likely to hike interest rates this month in the wake of last week’s non-farm payroll report. The BoJ is also unlikely to make any waves after the announcement that the sales (VAT) tax hike has been postponed and so soon before the Upper House elections.
USD/JPY has fallen, regardless of the recent risk-on sentiment with both oil prices and the Nikkei stock index. Continue reading
Metals continue to benefit from the morbid jobs report last week that froze the perception of a Fed rate increase next week despite Janet Yellen’s comments that interest rates are likely to increase in coming months. The ECB has begun a massive corporate bond- buying binge as the mandate continues to be focused on fighting deflation. The odds of a U.K. vote on remaining within the EU have now shifted to a majority towards an exit. When I last wrote, on Friday, we suggested that gold was a buy and that silver offered a better opportunity. Continue reading