Currencies

Nomura rounds up markets’ biggest misses in 2016

Forecasting markets a year in advance is never easy, but with “year-ahead investment themes” season well underway, Nomura has provided a handy reminder of quite how difficult it is, with an overview of markets’ biggest hits and misses (OK, mostly misses) from the start of 2016. The biggest miss among analysts, according to Nomura’s Sam […]

Continue Reading

Property

Spanish construction rebuilds after market collapse

Property developer Olivier Crambade founded Therus Invest in Madrid in 2004 to build offices and retail space. For five years business went quite well, and Therus developed and sold more than €300m of properties. Then Spain’s economy imploded, taking property with it, and Mr Crambade spent six years tending to Dhamma Energy, a solar energy […]

Continue Reading

Currencies

Euro suffers worst month against the pound since financial crisis

Political risks are still all the rage in the currency markets. The euro has suffered its worst slump against the pound since 2009 in November, as investors hone in on a series of looming battles between eurosceptic populists and establishment parties at the ballot box. The single currency has shed 4.5 per cent against sterling […]

Continue Reading

Banks

RBS falls 2% after failing BoE stress test

Royal Bank of Scotland shares have slipped 2 per cent in early trading this morning, after the state-controlled lender emerged as the biggest loser in the Bank of England’s latest round of annual stress tests. The lender has now given regulators a plan to bulk up its capital levels by cutting costs and selling assets, […]

Continue Reading

Currencies

China capital curbs reflect buyer’s remorse over market reforms

Last year the reformist head of China’s central bank convinced his Communist party bosses to give market forces a bigger say in setting the renminbi’s daily “reference rate” against the US dollar. In return, Zhou Xiaochuan assured his more conservative party colleagues that the redback would finally secure coveted recognition as an official reserve currency […]

Continue Reading

Categorized | Currencies

Rand gains from calmer EM waters


Posted on March 26, 2014

    The South African Reserve Bank on Thursday will deliver its latest monetary policy decision.

    Analysts’ consensus is for the SARB to leave rates alone after unexpectedly hiking them by 50 basis points to 5.5 per cent in January, ostensibly to support the rand.

    Still, Capital Economics describes the outcome as a close call.

    “A renewed slump in the currency before the meeting could prompt another rate hike but, as things stand, we think the SARB will refrain from raising rates this time around,” says the London-based research boutique.

    After being caught up in the emerging market fallout at the start of the year, with domestic industrial relations strife adding to the tension, the rand seems to have steadied for the time being, gaining 5 per cent or so since the SARB’s January tightening.

    Chart: South African rand against the dollar

    And it is worth noting that EM currencies generally have not displayed the kind of sensitivity many would have expected to last week’s shift in short-term US rate expectations following the “Yellen wobble”.

    The rand’s one-month implied volatility is near 13, below the 12-month average of 14.3 and well down from the spike above 18 seen at the end of January.

    Calmer times in EM forex?

    jamie.chisholm@ft.com