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Research Team

Monetary Policy & FX Review

Monetary Policy & FX Review is a review of monetary policy at eight central banks: the Fed, the ECB, the Bank of England, the Reserve Bank of Australia, the Reserve Bank of New Zealand, the Bank of Canada, the Swiss National Bank and the Bank of Japan. The aim of

Nasdaq Rout Sinks AUD/CHF, AUD/JPY as Franc and Yen Take Safe Haven Role

The rout in US technology stocks reverberated sharply across the currency market on Thursday, November 5. The Nasdaq fell as much as 6% intraday and is now roughly 15% below its high for the year. A gauge of the largest chipmakers has slumped more than 36% from its June record.

SFA Z-Score AUD/CHF : Aussie Deeply Oversold Against the Franc

Our SFA Z-score indicator is flagging an extreme divergence between the Australian dollar index and the Swiss franc index. Since October 28, the spread between the two currency indices has slumped to −4 standard deviations. It points to deeply oversold conditions and suggests the bearish impulse may be running

RBNZ’s Dovish Pause: Fed to Decide the New Zealand Dollar’s Next Move

The Reserve Bank of New Zealand surprised markets by deciding to leave its official cash rate unchanged at 2.75%. The central bank chose to bide its time and carefully assess incoming macroeconomic data, global uncertainty, and the fragile domestic economic recovery. This decision triggered a sharp reaction in the

SFA Z-Score: EUR/NZD Nears Key Reversal Point

Since October, our SFA Z-score indicator shows that the divergence between the New Zealand dollar index and the euro index has been widening. The spread between the two currency indices has closely approached the two-standard-deviation mark—a historically significant reversal point signaling an excessive divergence in asset

Bank of Canada Rate Decision: Why Even a Rate Hike Won't Save the Canadian Dollar?

The Bank of Canada will hold its monetary policy meeting this Wednesday. The consensus forecast expects the central bank to raise the rate to 2.5%. However, even if the Bank of Canada hikes rates, the question remains whether monetary tightening can lead to a further appreciation of the Canadian

Drivers of Last Week's Volatility and the Swiss Franc's Rally

October U.S. inflation data showed headline inflation accelerating to 3.7% year-over-year (surpassing the 3.6% consensus forecast), while the core Consumer Price Index (Core CPI) rose to 2.6%. A disturbing signal for investors was that price pressures broke out of the energy sector and began

AUD pushes higher, though a pullback looks likely

The Australian dollar is gaining strength this week. As shown by the SFA Index, the Aussie (green line) kicked off a steady rally right after the Reserve Bank of Australia released the minutes from its latest monetary policy meeting on October 13. The minutes from the RBA’s September meeting

Wednesday's CPI: What to Expect and How It Will Impact the US Dollar

On Wednesday, October 14, fresh U.S. inflation data (CPI and Core CPI) for September will be released. Market consensus forecasts an acceleration in annual inflation from 3.4% to 3.6%. Meanwhile, the monthly growth rate is projected at 0.4%–0.6%. At the same time, regarding core

EURGBP: 0.8450 Level Review

The EURGBP exchange rate remains near 0.8450. The currency pair has so far failed to break this support line at the previous July low and will likely remain within the 0.8450 - 0.8610 channel. Since June of this year, three key points have been identified that define the