Corrective forces continue to grip the foreign exchange market. Many expect the dollar's downside correction/consolidation to end today. Technically-inspired short-term participants often see 3-4 day counter-trend moves to be typical of market moves.
In August Fed Chair Janet Yellen delivered an extended analysis of "Labor Market Dynamics and Monetary Policy" at the annual Jackson Hole Symposium. Her speech essentially reviewed the ongoing debate over the cyclical versus structural factors in employment since the Great Recession.
Growth worries about Europe and Ebola headlines provide the unsettling backdrop for today’s stock market action. Stock have faltered lately, with a combination of global growth worries and Fed policy uncertainty weighing on sentiment.
With few exceptions, commodity prices have fallen sharply in recent months, to their lowest levels in over a year. Relative to stock market indices, broad commodity indices are now at their lowest levels since the late-1990s dotcom boom.
This may be excessively optimistic on my part, but there seems to be a slow change in the way the world thinks about reserve currencies. For a long time it was widely accepted that reserve currency status granted the provider of the currency substantial economic benefits.
In May we started a recurring monthly review of all the main economic data. At the time, the consensus view was that growth in wages and employment were accelerating and that this would lead to a meaningful increase in inflation above the Fed's 2% target. So far, this has been wrong.
The strong jobs report confirms that the U.S. economy’s fundamentals are strong enough to sustain its positive momentum despite the sub-par outlook for its trading partners in Europe, Japan and China. This report also shows that the soft reading for the preceding month was an outlier.
Here is a new update of a popular market valuation method using the most recent Standard & Poor's "as reported" earnings and earnings estimates and the index monthly averages of daily closes for the past month...
This seems to be the first time in several months that ECB President Draghi has been rather anti-climactic. The disappointment or the "sell the rumor, buy the fact" scenario we suggested is, in fact, unfolding, and the euro is correcting higher.
Two years ago, the new seven-member Standing Committee of the Chinese Communist Party Politburo — the most powerful political entity in the country — was introduced to great fanfare. All seven men walked on stage wearing a dark suit and a red tie, but to me the most striking aspect of their appearance was their hair.