Chief Markets Correspondent, London
Jamie's Feed
Mar 19, 2015

HSBC swims against FX tide, raises euro forecast to $1.20

LONDON, March 19 (Reuters) – HSBC went against the
overwhelming consensus for euro weakness on Thursday by raising
its euro forecast to $1.20 by the end of 2017, arguing that the
dollar’s explosive rally was nearing its end.

It is the most contrarian call on the single currency from
any major bank and comes after many slashed their forecasts,
predicting a break below parity with the dollar and in some
cases a record low.

Mar 18, 2015

U.S. firms use cheap euros to access dollars, but window closing

LONDON (Reuters) – The stark divergence between U.S. and euro zone monetary policy has made it more attractive than ever for U.S. companies to raise cash in euros and swap it back into dollars this year, but that window of opportunity could be closing.

The euro/dollar cross currency basis swap, effectively the cost of swapping one currency into the other without the exchange rate risk, recently showed the highest premium for dollars in more than two years.

Mar 16, 2015

German stocks power to new high; euro, Fed in focus

LONDON, March 16 (Reuters) – German stocks surged to a
record high on Monday as investors shrugged off a bounce by the
euro and focussed on the expected boost to corporate earnings
from the currency’s recent slump, which saw it touch a 12-year
low earlier in the day.

The DAX powered above 12,000 points for the first time and
the main pan-euro zone benchmark indices hit seven-year highs,
while U.S. futures pointed to a higher open on Wall Street of
around 0.5 percent.

Mar 16, 2015

Weak euro powers European stocks to new highs

LONDON (Reuters) – The euro struck a fresh 12-year low on Monday and euro zone stocks reached new peaks on bets that the currency’s relentless fall will boost corporate earning prospects just as the rising dollar hits those of U.S. firms.

German stocks powered above 12,000 points for the first time, while the main pan-euro zone benchmark indices hit new seven-year highs.

Mar 13, 2015

Goldman slashes euro forecasts, sees new low $0.80 by end-2017

LONDON, March 13 (Reuters) – U.S. investment bank Goldman
Sachs slashed its forecasts for the euro on Friday, predicting
that it will fall through parity with the dollar within a year
and plunge to a new record low of $0.80 by the end of 2017.

Goldman’s outlook for the euro is now the gloomiest of all
major financial institutions, and comes at the end of a week
that saw the European Central Bank launch its “quantitative
easing” bond-buying stimulus programme and several banks slash
their forecasts for the single currency.

Mar 11, 2015

Euro/dollar shock forces rethink across world markets

LONDON, March 11 (Reuters) – The euro’s accelerating slide
towards parity with the dollar and beyond has caught investors
and multi-national firms off guard, forcing scrambled revisions
of long-range forecasts and a major strategic rethink across
global markets.

The euro/dollar rate, which channels almost a quarter of
the$5 trillion that flows daily through world currency markets,
has been falling steadily for months, as markets factored in the
European Central Bank’s 1 trillion euro stimulus plan which
finally began this week.

Mar 10, 2015

UK draws billions in unrecorded inflows, much from Russia-study

LONDON, March 10 (Reuters) – Britain is attracting around a
billion pounds ($1.5 billion) of capital inflows a month not
recorded by official statistics, up to 40 percent probably from
Russia, according to a Deutsche Bank study on Tuesday.

Among the reasons behind “net errors and omissions” (NEO)
from official data are misreporting by financial institutions,
sophisticated tax avoidance and accounting methods, and
Britain’s perceived “safe-haven” status, the report said.

Feb 24, 2015

Shrinking liquidity tops financial market concerns in BoE review

LONDON, Feb 24 (Reuters) – Concern is growing among banks
and investment funds that heavier regulation has led to a number
of key financial markets becoming too thin to soak up sharp
price swings or bouts of volatility, laying the groundwork for
another financial crisis.

That’s the common thread running through the responses of 66
market participants to a consultation led by the Bank of England
on what needs to be done to reinforce confidence in the fairness
and effectiveness of fixed income, currency and commodities
(FICC) markets.

Feb 24, 2015

World on cusp of major demographic shift that will hit stocks, bonds

LONDON (Reuters) – The global “savings glut” that has driven stocks to record highs and bond yields to record lows will soon start to disappear, leading to higher interest rates around the world as populations age, according to a Barclays study.

After three decades when workers saving for retirement have been a major source of financial market funding, younger people entering the workforce are gradually becoming outnumbered by those ready to stop work and tap those savings.

Feb 24, 2015

World on cusp of major demographic shift that will hit stocks, bonds: study

LONDON, Feb 24 (Reuters) – The global “savings glut” that
has driven stocks to record highs and bond yields to record lows
will soon start to disappear, leading to higher interest rates
around the world as populations age, according to a Barclays
study.

After three decades when workers saving for retirement have
been a major source of financial market funding, younger people
entering the workforce are gradually becoming outnumbered by
those ready to stop work and tap those savings.