Weekly Importer / Exporter Analysis 3-30-15

Importers sweep the week, reversing nearly all of the gains that exporters made last week.  Nothing has fundamentally changed, the trend will continue to be in importer’s favor for the foreseeable future.

Greece needlessly continues to drag talks along.  With big payments due in April, funds leaving the banking system, and (this may be a shocker) Greek citizens continuing to not pay taxes the government is struggling to pay pensions and workers.  I expect the government to finally bow to European pressure in the next few weeks and get the extension funding needed to last most of the summer.

Other US economic data for this week is here.

Who won the battle last week, between the USD and five currencies?  The perspective is strictly from America, so if against the Aussie Dollar, United States importers won, that also means Australian exporters won as well.  I am changing the sign convention: negative percentage changes mean that exporters have the advantage while positive numbers show the advantage for importers.

Currency Week Ending 3-27-15 Weeks in a Row Weekly Change YTD Change
Australian Dollar (AUD) Importers Win! 0 2.3% 6.42%
Canadian Dollar (CAD) Importers Win! 0 1.0% 8.30%
Euro (EUR) Importers Win! 0 0.8% 10.45%
British Pound Sterling (GBP) Importers Win! 0 0.9% 5.10%
Japanese Yen (JPY) Importers Win! 0 0.3% 0.12%

Thanks,

Damon

Weekly Importer / Exporter Analysis 3-23-15

Exporters sweep the week in dramatic fashion.  The Federal Reserve talked about raising interest rates in the near term but reduced their long term expectations.  This changed the calculus of how fast the Fed might raise rates which in turn lowered the long term value of the dollar relative to other currencies.  While markets digest these new scenarios this will be a brief respite for exporters, but the general trend remains the same: stronger dollar.

Greece continues to clown while their economy is in shambles.  Calling for World War II reparations from the country that ultimately authorizes the financing is not a good negotiating strategy.  With the creditors holding all of the cards and Greek citizens moving money out Greece, how long can they hold out?  An emergency meeting of Euro zone finance ministers on the 27th might seal Greece’s fate, though they are likely to provide the minimum assistance necessary to keep things limping along.

Other US economic data for this week is here.

Who won the battle last week, between the USD and five currencies?  The perspective is strictly from America, so if against the Aussie Dollar, United States importers won, that also means Australian exporters won as well.  I am changing the sign convention: negative percentage changes mean that exporters have the advantage while positive numbers show the advantage for importers.

Currency Week Ending 3-20-15 Weeks in a Row Weekly Change YTD Change
Australian Dollar (AUD) Exporters Win! 1 -2.1% 4.13%
Canadian Dollar (CAD) Exporters Win! 0 -1.9% 7.28%
Euro (EUR) Exporters Win! 0 -2.7% 9.60%
British Pound Sterling (GBP) Exporters Win! 0 -0.7% 4.23%
Japanese Yen (JPY) Exporters Win! 0 -1.3% -0.19%

Thanks,

Damon

Weekly Importer / Exporter Analysis 3-16-15

Importers gain in all currencies except the Australian dollar, which had a minor rebound.   All eyes are on the Federal Reserve and Janet Yellen.  Will they commit to raising interest rates sooner than predicted?  The stock markets are already moving on the notion that rate increases are coming sooner rather than later.  When rates increase this will increase the gains for importers and losses for exporters.  The announcement is scheduled for 2 pm ET on Wednesday.

After a week of missing in action, Russian dictator and friend of the blog Vladimir Putin had a public meeting today.  This kyboshed a number of conspiracy theories ranging from health problems to a coup.  I am guessing that the news is good for the Russian economy, though I’m not sure if that will change its plummeting trajectory.

Greece is facing a liquidity crunch, paying the newly named “Brussels Group” (the Troika plus the European Stability Mechanism) with pension funds and EU farm subsidies.  They claim they can get by, but for how long?  A continuing fight with Germany is only hardening positions, it looks like Greece will only be able to change vocabulary and not actual terms.

Other US economic data for this week is here.

Who won the battle last week, between the USD and five currencies?  The perspective is strictly from America, so if against the Aussie Dollar, United States importers won, that also means Australian exporters won as well.  I am changing the sign convention: negative percentage changes mean that exporters have the advantage while positive numbers show the advantage for importers.

Currency Week Ending 3-13-15 Weeks in a Row Weekly Change YTD Change
Australian Dollar (AUD) Exporters Win! 0 -0.1% 6.24%
Canadian Dollar (CAD) Importers Win! 2 1.1% 9.11%
Euro (EUR) Importers Win! 3 1.2% 12.34%
British Pound Sterling (GBP) Importers Win! 2 1.8% 5.01%
Japanese Yen (JPY) Importers Win! 3 0.1% 1.11%

Thanks,

Damon

Weekly Importer / Exporter Analysis 3-9-15

Importers sweep for the second week in a row.  Dollars are clearly in demand as a stronger US economy overshadows Europe and most of Asia.  An excellent employment report on Friday showed growth despite record snow in the Northeast.

An appreciating dollar also has geopolitical consequences.  As the dollar increases in value, oil prices (along with other commodities) tend to decline in value as they become more expensive in other currencies.  This keeps pressure on Russia, Iran, and Venezuela, all oil dependent economies.   Keep an eye out on Russian corporate defaults as dollar cash reserves are depleted and the ability to pay loans is reduced.

Other US economic data for this week is here.

Who won the battle last week, between the USD and five currencies?  The perspective is strictly from America, so if against the Aussie Dollar, United States importers won, that also means Australian exporters won as well.  I am changing the sign convention: negative percentage changes mean that exporters have the advantage while positive numbers show the advantage for importers.

Currency Week Ending 3-6-15 Weeks in a Row Weekly Change YTD Change
Australian Dollar (AUD) Importers Win! 1 1.8% 6.31%
Canadian Dollar (CAD) Importers Win! 1 0.8% 7.97%
Euro (EUR) Importers Win! 2 3.8% 11.10%
British Pound Sterling (GBP) Importers Win! 1 2.2% 3.20%
Japanese Yen (JPY) Importers Win! 2 1.3% 0.96%

Thanks,

Damon

Weekly Importer / Exporter Analysis 3-2-15

Importers sweep the week.  A number of trends are likely to make it a good year for US based importers and foreign based exporters.

1. Europe and Japan continue Quantitative Easing

The effect is to keep interest rates low.  Since the Federal Reserve is looking for reasons to increase interest rates in the United this year, the long term trend is for dollars to become more valuable versus other currencies.

2. Consumer spending in the US to pickup

Consumers have had a few reasons to increase spending.  Gasoline prices are low, providing extra cash to spend.  The record cold winter in the Northeast has pent up demand.  Finally, wages are starting to increase, providing a lift to the over all economy. The US is basically the only economy that is growing in a meaningful way.

3. Global events cause people to hold dollars

There are a litany of events that is causing cautious investors to increase their dollar holdings.  Greeks are converting their Euros to dollars and US real estate, rather than helping their countrymen by investing at home.  The murder of former Russian deputy prime minister and opposition leader Nemtsov will have ramifications.  Will this be seen as the turning point of Putin’s rule?  Ukraine faces enormous risks, as well as its neighbors.  Last but not least, the debate over Iran is being framed as diplomacy or war.  I cannot see a war with Iran being a positive for anyone’s economy, and if diplomacy fails, look for people to start hoarding dollars as the price of oil goes on a roller coaster.

Other US economic data for this week is here.

Who won the battle last week, between the USD and five currencies?  The perspective is strictly from America, so if against the Aussie Dollar, United States importers won, that also means Australian exporters won as well.  I am changing the sign convention: negative percentage changes mean that exporters have the advantage while positive numbers show the advantage for importers.

 

Currency Week Ending 2-27-15 Weeks in a Row Weekly Change YTD Change
Australian Dollar (AUD) Importers Win! 0 1.0% 4.54%
Canadian Dollar (CAD) Importers Win! 0 0.6% 7.10%
Euro (EUR) Importers Win! 1 1.2% 7.31%
British Pound Sterling (GBP) Importers Win! 0 0.4% 1.04%
Japanese Yen (JPY) Importers Win! 1 0.3% -0.41%

Thanks,

Damon

Weekly Importer / Exporter Analysis 2-23-15

Mixed results as markets determine the impact of the Greek drama deescalation and the cease fire in Ukraine.  The leftist Greek government finally backed down from the edge, basically gaining nothing and having to back track on election promises.  They will continue to implement the hated austerity policies in exchange for a four month extension.  While the problem of a Grexit is not resolved, it is clear that they want to stay in the Euro zone.

It seems that the cease fire is tenuously working, with the Russian invasion of Ukraine temporarily on hold.  This allows for the currency crisis to resurface and Gazprom to renew natural gas cutoffs.  The IMF helped Ukraine with a package last month, will it be enough to prevent an economic collapse?

Other US economic data for this week is here.

Who won the battle last week, between the USD and five currencies?  The perspective is strictly from America, so if against the Aussie Dollar, United States importers won, that also means Australian exporters won as well.  I am changing the sign convention: negative percentage changes mean that exporters have the advantage while positive numbers show the advantage for importers.

 

Currency Week Ending 2-20-15 Weeks in a Row Weekly Change YTD Change
Australian Dollar (AUD) Exporters Win! 1 -1.5% 3.47%
Canadian Dollar (CAD) Exporters Win! 2 -0.4% 6.52%
Euro (EUR) Importers Win! 0 0.2% 6.15%
British Pound Sterling (GBP) Exporters Win! 2 -0.7% 0.59%
Japanese Yen (JPY) Importers Win! 0 0.5% -0.72%

Thanks,

Damon

Weekly Importer / Exporter Analysis 2-16-15

Exporters sweep the week as global tensions ease.  The cease fire in Ukraine is holding up and the European Union may have some relief for Greece.  Keep your fingers crossed.

Here in Boston, I don’t know about you, but I can use some more snow!

Other US economic data for this week is here.

Who won the battle last week, between the USD and five currencies?  The perspective is strictly from America, so if against the Aussie Dollar, United States importers won, that also means Australian exporters won as well.  I am changing the sign convention: negative percentage changes mean that exporters have the advantage while positive numbers show the advantage for importers.

 

Currency Week Ending 2-13-15 Weeks in a Row Weekly Change YTD Change
Australian Dollar (AUD) Exporters Win! 0 -0.1% 4.96%
Canadian Dollar (CAD) Exporters Win! 1 -0.5% 6.91%
Euro (EUR) Exporters Win! 0 -0.4% 5.96%
British Pound Sterling (GBP) Exporters Win! 1 -0.6% 1.37%
Japanese Yen (JPY) Exporters Win! 0 -0.6% -1.21%

Thanks,

Damon