Euro Surges On Draghi’s “Three Messages,” Dollar Eyes Janet, Yuan “Suddenly” Jumps

Boy, I’ll tell you what, if you’re a central banker and you’re going to say something in public about monetary policy, you better make sure you choose your words really fucking carefully, because this market is hyper-sensitive. Here’s what we got from Draghi who, speaking at the ECB Forum on Central Banking in Sintra, Portugal, said he…

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“Bigly”: Reflation Is Back As Dollar Rises, Global Stocks Rally, Oil Eyes EIA Data

Apparently, reports of the reflation meme’s demise were greatly exaggerated. It wasn’t too long ago when traders were beginning to wonder if the Trump trade was dying on the vine. One super awesome, extra bigly, “phenomenal” tax plan promise and one hawkish Janet Yellen later, and reflation is alive and kicking. Here’s SocGen’s morning take:…

Markets Relieved After Trump/Abe Meeting, Reflation Narrative Intact

Well, it was all aboard the reflation train right out of the gate in early Asian trading last night with USDJPY jumping with 10Y yields and futs, following what counts as a “successful” high level summit these days. As I noted last week, the fact that Trump didn’t physically assault Japanese PM Shinzo Abe (well,…

Bad Chinese

By now, you’re probably aware that China is in a tough spot. As I’m fond of saying, Beijing is trying to do the impossible: they’re trying to deleverage and releverage at the same time. In a nutshell, China has to maintain the illusion that the economy is growing at a clip somewhere near 6.5% while…

Daily Kickstart (Chinese FX Reserves Fall Below $3 Trillion, Euro On The Back Foot, Senate Weighs Risk Of School Grizzly Attacks)

The “big” news overnight should have been Chinese FX reserves just like China should be back in the global spotlight more generally as it becomes increasingly apparent that the PBoC is leaning towards financial stability at the possible expense of growth (i.e. they’re in tightening mode). Overnight we learned that Beijing’s FX reserves fell below the magic $3…

Big Trouble In Little China

Given that today is Donald Trump’s coronation, it’s somewhat ironic that we begin in China, where the Politburo was kind enough to tell us what they want us to think GDP is.

China’s Nasdaq Crashes

The normalization of initial public offerings (IPOs) in China could help raise the financing efficiency of companies and direct more capital into the real economy, experts have said. Since an IPO suspension between July and November 2015, the country’s securities regulator has progressively sought to normalize IPOs. That’s from Xinhua, and anyone holding shares on…

Chart Check (Let’s All Move To Hong Kong)

Are you a Chinese citizen who wants to circumvent Beijing’s increasingly onerous capital controls on the way to protecting yourself from the vicissitudes of the RMB? No problem. Just buy Hong Kong stocks. Sure, you’ll have to be repaid in yuan when you cash out, but as Bloomberg notes, in the meantime you’ll be shielded from the…

It’s A “Clearly Artificial Regime”: No Love For The PBoC

Last week, we witnessed a truly epic short squeeze in Hong Kong. Soaring deposit rates, dramatic spikes in CNH HIBOR, and harrowing moves in forward points accompanied the biggest two-day gain for the offshore yuan on record as liquidity evaporated faster than a democrat’s lead in a Presidential race against a reality TV star. As one…

Tuesday Chart Check (Bitcoin Edition)

Sure, many Chinese citizens are so desperate to move money out of the country that they’re willing to risk dealing with shady underground go-betweens using tea shops as fronts to get cash to Hong Kong (more here). Sure, these same Chinese citizens are willing to travel to Macau to skirt capital controls by using UnionPay cards to…

Tuesday Chart Check (Squeeze Please Edition)

Shaking out the shorts…

Daily Kickstart (Currency Chaos Edition)

The pound gets pounded while the RMB remains volatile. The offshore yuan posted its largest two-day decline since last summer.

Albert Edwards Wants To Know Why No One Gives A Sh*t About China Anymore

“Global markets really couldn’’t seem to give a toss about events in China. Yet they should.”

Daily Kickstart (China FX Edition)

Whither the yuan…

These Are The Two Main “Risk Scenarios” For Markets

There are a lot of things you can say about Heisenberg, but one thing you can’t say is that I fell asleep at the wheel when it came to warning you about the risks markets face in 2017. In fact, I rarely fall asleep at all, much less while driving. Over the past several months…