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The carnage on the USD started last Thursday and the three currencies that battered the USD the most was the GBP, EUR and the AUD.

The question is whether it was warranted or not, or was it simply a case of fund flows?  Or did the market move against the USD because the BOE, ECB and RBA moved from an accommodating stance to a neutral stance?  Is that enough to move the market so significantly?  I do not believe so.

Personally, I expected the other central banks to move to a neutral stance, given that the Federal Reserve has already begun cutting back QE by two tranches of $10Bn each from $85Bn to now $65Bn.

Is there an opportunity for the USD to take back some ground from the majors?  Yes, I believe so, and it has started today with the GBP giving back about 60bps so far.  I should have captured this opportunity since I felt so strongly about it.

Unfortunately, I was taken away to focus on my private equity business in a company I invested that is involved in the tocotrienol business.

5 Comments

  1. Its like you read my mind! You appear to know so much about
    this, like you wrote the book in it or something. I think
    that you can do with a few pics to drive the message home a little bit, but instead of that, this is
    fantastic blog. A fantastic read. I will certainly be back.

    • Hi Maximo,

      Thank you for the kind comments. Let’s do stay in touch. You can also write to me directly at; andrew.chew@thepanthenongroup.com

      Apologies for the lack of update on my site, have been handling some personal family issues. I will endeavor to update the past trades and to keep the site up to date.

    • Thank you Maximo,

      I trust you are also doing well in the FX market.

      I do post charts periodcally when I write my articles, however, I do take in your point and I will be more conscientious in putting up more charts and pics in future.

      Warmest Regards,

      Dr. Andrew Chew

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