Market Review – Fundamental Perspective 22 January 2018

Last week the US dollar was trying to perform it's best Lazarus impersonation but fell well short on all accounts not only hampered by dwindling long-term sentiment but also feeling the weight from the latest political fracas in Washington. However, the dollar has not weakened off to dramatically this morning after Shutdown headlines with USDJPY off about 20 pips to 110.60 at the Wellington Open. Sure the government shutdown remains in focus, but it's not a significant USD driver as it presents only a minuscule shock to risk appetite

Not unexpectedly SPD agreed to start formal coalition talks with Merkel; a decision which moves Germany closer to form a new government.By accepting to pursue further discussions and thereby dramatically improving the chances for another grand coalition, a temporary calm should engulf the EU political landscape. However, German political developments were not thought to be a significant disruptor, so the market focus now pivots to this weeks ECB. A bit of everything for everyone this week with, politics, central banks earnings and Trump in Davos could be this weeks marquee event.

The focus will be on Davos and the World Economic Forum that will take place from Tuesday to Friday with President Trump due to deliver a keynote address on the final day. Anytime Trump takes the podium, especially when he's the headline event, the chance for market turmoil elevates two-fold. This time around, there are lots of gossips that he could use this platform to up the protectionist ante, but so far other than pulling out of TPP the risk of protectionism under President Trump has mostly proved a red herring. Stay tuned! However, the big currency mover this morning was the Turkish Lira as USDTRY moved +1.5 %after Turkey launched airstrikes in Syria against US-backed Kurdish fighters.

PCM Enterprise - Development Firms Review