Ricky Cove
Disclosure: I am in full compliance with all ethics and other policies for Market Realist research analysts. I am not invested in securities that I cover on Market Realist.
More From Ricky Cove
Have We Seen a Short-Term Bottom for the Dollar?
The US Dollar Index (UUP) managed to close in positive territory in the week ended February 8, 2018, after posting seven consecutive weekly losses.
Why Did the US Federal Reserve Turn Hawkish at Its June Meeting?
As expected, the Federal Reserve increased the interest rate by 25 basis points after its June meeting, which concluded on June 13.
Your Update on the FOMC July Meeting
In its July meeting, the Federal Open Market Committee decided to maintain its target range for the federal funds rate at 1%–1.25%, in line with the market’s expectations.
Mexico Is Hitting Republicans in Their Weak Spot
Mexico hit the American economy where it hurts the most with tariffs on American products like pork, steel, apples, potatoes, cheese, and bourbon.
Are the Markets Too Optimistic?
Market participants were caught by surprise when they read that the Federal Open Market Committee’s members were concerned about slowing growth in the US economy during 1Q17.
The Housing Industry Is Painting a Positive Outlook for the Economy
In April, the number of building permits issued was reported at 1.35 million, a decrease of 1.8% from the downward revised March reading of 1.37 million permits.
Will the Euro Continue Its Momentum?
Markets will remain focused on the ECB policy meeting scheduled for Thursday this week.
Is the Fed Sure What It’s Doing?
In this series, we’ll analyze Fed members’ comments in June 2017 to better understand their outlooks on the US economy and how they justify their hawkish or dovish stances.
Will Yellen’s Hawkishness Drive the US Dollar Higher?
The US Dollar Index (UUP) closed at 95.79 with a rise of 0.39% last week. This rise was a welcome relief for the dollar.
Why the British Pound Rallied Sharply in the Week Ended March 23
The FTSE 100 Index (UKX) fell ~3.4% for the week ended March 23, 2018, and closed at 6,921.94.
Euro Reaches 23-Month Peak: Could It Climb Higher?
Euro rallies to a 23-month peak Last week, the euro (FXE) closed at 1.17, appreciating by 1.7% against the US dollar (UUP). The currency has appreciated by more than 10% against the US dollar this year, making it one of the strongest developed market currencies. Improving economic conditions and a stable political climate turned the […]
How Will a Busy Week of Macros Affect Markets?
The first week of May is packed with key macro events. On the monetary front, we have the FOMC meeting scheduled during the week and the all-important April jobs numbers set to come out on Friday.
Bank of England Raises Interest Rate to 0.50%
The BOE (Bank of England) in its November meeting increased its benchmark interest rates from 0.25% to 0.50%.
Super Thursday Surprise: The UK Election
The UK’s hung parliament result on June 8 was the only real surprise that markets witnessed on what was being referred to as “Super Thursday.”
Why Rising Trade Is a Great Sign for the Global Economy
According to the latest trade deficit report, exports of food, feed, and beverages have decreased $1.3 billion, and soybean exports have decreased $1.4 billion.
Analyzing the Fall in December’s Existing Home Sales
According to the January report from NAR, existing home sales decreased 3.6% to a seasonally adjusted annual rate of 5.57 million homes in December.
A Tale of 4 Central Banks
In this series, we’ll analyze how different asset classes like bonds (BND) and global equities (VTI) reacted to last week’s central bank events.
Why May’s Inflation Was Just Hot Enough
On June 12, the US Bureau of Labor Statistics reported that US consumer prices rose 0.2% in May, adding to the 0.2% increase seen in April.
Why the Recent REIT Rebound Could Stretch a Little Further
The real estate sector (VNQ) has been lagging in performance in 2018. It’s seen a year-to-date loss of 6%.
What Drove Retail Sales Higher in April?
The April retail sales report indicated that the gains were broad-based with nine of the 13 major categories moving higher during the month.
How to Transact in Bitcoin and Other Cryptocurrencies
If you have purchased bitcoin currency, and it’s now in your digital wallet, there will likely be a time that you’ll want to conduct a transaction with it.
Could New Home Sales Continue to Rise?
The US Census Bureau and Department of Housing and Urban Development report monthly data on the number of new homes sold in the United States.
Why Existing Home Sales Have Been on a Continuous Slide
The United States National Association of Realtors (or NAR) releases a monthly report on the existing home sales (ITB) market.
What American Builders Were Worried about in June
The HMI was reported to have decreased by two points to 68 in June as compared to a May reading of 70.
Are Rising Rates Affecting Housing Markets?
Rising interest rates increase the cost of owning a home for prospective buyers, but the housing market hasn’t yet felt the impact of rate increases.
Why Did the Euro Appreciate against the US Dollar?
European equity markets didn’t have the same enthusiasm as the euro, as new tariff threats to the European car industry from the Trump administration unnerved investors.
What Drove the Leading Economic Index Higher in May?
According to the June 21 Conference Board report, the May LEI was 109.5—a 0.2% increase from the revised April LEI of 109.3.
Does Donald Trump Think He Has the Upper Hand?
Donald Trump added fuel to the trade war fire by announcing that the United States would extend 10% tariffs to $200 billion of Chinese (GXC) imports.
Why the Yen Depreciated against the Dollar
Last week, the Japanese yen (JYN) succumbed to the US dollar’s strength. The Japanese yen (FXY) closed the week at 110.67.
US Dollar Is Dominating the Forex Markets
The US Dollar Index (UUP) managed a sharp recovery last week. The appreciation seemed to be due to tariff announcements.
Why Industrial Production Figures Dipped in May
Industrial production in the United States fell 0.1% in May as compared to an increase of 0.9% in April.
What Drove Retail Sales Higher in May?
The United States Census Bureau releases a monthly report on retail sales in the United States. Let’s take a look at the latest data.
FOMC: We Are Not Declaring a Victory on Inflation
The FOMC’s June statement was released on June 13, and the outlook for inflation remained upbeat.
Why Does the Fed Expect Unemployment to Fall Further?
The US Federal Reserve has a dual mandate of achieving maximum employment and stable prices (TIP) in the economy.
How Could High Inflation Affect the Fed?
During the Fed’s May meeting, the inflation (TIP) target was described as “symmetric,” suggesting that the 2% target would not be used to initiate any dramatic changes to US monetary policy.
Why This Week Could Define the Direction of Monetary Policy
The central banks of the US, EU, and Japan are scheduled to meet this week.
What Now as the US Fed Is Close to Meeting Its Targets?
As of June 1, the unemployment rate in the US has dropped to 3.8%—its lowest level in the last 18 years.
April Jobs Report: More Jobs Than Job Seekers
April’s JOLTS data indicate that there were only 0.9 job seekers for every job available.
Treasury Yields and Trade War Fears Driving USD-JPY Price Action
The Japanese yen returned to weakness against the US dollar as political uncertainty in the euro area fell at the end of the week that ended on June 1.
What’s the Link between Italian Policy and the Euro?
The euro-dollar (FXE) exchange rate managed to move back above 1.16 against the US dollar (UUP).
Are Tax Cuts Helping US Consumers Spend More?
On May 31, the BEA’s report on personal income and spending for April indicated that personal income rose 0.3%.
Which Sector Posted the Most Job Gains in May?
As per the May ADP employment report, job growth in the professional and business services sector continued to be the key driver for jobs additions.
ADP: May Payrolls Could Be below 180,000
According to the ADP National Employment Report, the US private sector added 178,000 jobs in May.
Why May Consumer Confidence Signals a Strong Second Quarter
The consumer confidence index has increased to 128.0 in May as compared to a downward revised April reading of 125.6.
Will the Rollback of Dodd-Frank Help the Real Estate Sector?
In a continued effort to deregulate the economy, President Donald Trump signed the Economic Growth, Regulatory Relief, and Consumer Protection Act.
Why REIT Valuations Look Attractive as the Market Hits the Roof
In the recently concluded first quarter, more than 95% of REITs reported earnings beats and maintained their guidances for 2018.
Why the Fall in April New Home Sales Isn’t a Reason to Worry
As per the recent report, new single-family homes (XHB) sold in April were at a seasonally adjusted rate of 662,000 units.
Why Existing Home Sales Continued Their Decline in April
The US National Association of Realtors (or NAR) releases a monthly report on the existing home sales (ITB) market.
Tax Rules: Are Changes Helping Durable Goods Orders?
The durable goods orders in April were below the market expectations. The durable goods orders decreased by $4.2 billion or 1.7% to $248.5 billion.
Will Safe-Haven Demand Push the Japanese Yen Higher?
Last week, the Japanese yen (JYN) managed its first weekly gain against the US dollar in nine weeks.
Should Housing Investors Worry about Declining Building Permits?
An increase in the number of building permits in any given month is a signal for increased activity in the housing sector (DHI) in the future.
What’s Driving the British Pound Lower against the US Dollar?
The British pound (FXB) depreciated against the US dollar (UUP) for the fifth week in the last six weeks.
Why Italian Election Uncertainty Drove EUR-USD Lower
Last week, the euro-dollar (FXE) exchange rate moved below 1.16 for the first time in six months.
What’s Driving the US Dollar Higher?
The US Dollar Index (UUP) continued to appreciate but did so slowly in the week that ended on May 25.
Why American Builders Remain Confident about the Housing Industry
The housing market index was reported to have increased by two points to 70 in May compared to the downwardly revised April reading of 68.
Key Takeaways from May’s FOMC Meeting Minutes
The most recent FOMC meeting was on May 1–2. At the meeting, the range for the federal funds target rate was left unchanged.
Why Fed Minutes Could Put Further Pressure on the Yen
Last week, the Japanese yen depreciated against the US dollar for the eighth consecutive week as the dollar continued its upward surge.
Are New Tax Rules Helping Capex Spending by Industries?
As per the latest Conference Board LEI report, the core capital goods orders for April were valued at $39.1 billion as compared to the downward revised March reading of $39.0 billion.
What Led to the Decline of the ISM New Orders Index in April?
The ISM New Order Index for April was reported at 61.2, which represented the fourth consecutive monthly decline for the index.
Can the US Dollar Continue to Surge Higher?
Last week, the US dollar index bounced back from a minor pullback in the week ended May 11, aided by the rise of bond yields.
Falling Weekly Claims Signal Overheating Job Market
The Conference Board uses average weekly unemployment claims as a constituent of its Leading Economic Index (or LEI).
Why Drove the Leading Economic Index Higher in April?
The latest Conference Board LEI reading was released on May 17. The LEI for April came in at 109.4, an increase of 0.4% from the March reading of 109.0.
Why Bond Yields Rose on Tuesday
The April retail sales report was released on May 15, and the surprise reaction to this report was an increase in bond (BND) yields across the board.
Could There Be Respite for the Falling Yen?
Last week, the Japanese yen (JYN) depreciated against the US dollar for a seventh consecutive week, despite US dollar weakness.
Could It Be Time to Sell the British Pound?
The British pound (FXB) was unchanged against the US dollar (UUP) last week despite the dollar’s rally stalling, possibly due to the BOE’s (Bank of England) move to leave policy rates unchanged.
Why Disappointing Data Has Had Limited Impact on the Euro
The euro-dollar (FXE) exchange rate closed at 1.2 on May 11, with the euro depreciating by 0.13% against the US dollar (UUP).
What Drove the US Dollar Lower Last Week
The US dollar index (UUP) took a breather last week, closing at 92.44, 0.03% higher than its close of 92.41 in the week ended May 4.
Could the US Dollar Slump Be Short Lived?
The US dollar depreciated against its major trading-partner currencies after the Bureau of Labor Statistics reported on May 10 that US consumer prices grew 0.1% in April after falling 0.1% in March.
Bond Yields Fall after April Inflation Data Release
US bond market investors were relieved after the US Bureau of Labor Statistics’ April report, published May 10, indicated a lower-than-expected inflation growth rate.
How April’s Inflation Data Relieved Markets
On May 10, the Bureau of Labor Statistics reported that US consumer prices rose 0.2% in April.
What Are the Implications of Iran Nuclear Deal Exit?
In this series, we’ll analyze how the US exit from the Iran deal has affected markets and how recent developments could affect oil prices and volatility.
Will the Japanese Yen Continue to Depreciate against the US Dollar?
Last week, the Japanese yen (JYN) depreciated against the US dollar for a sixth consecutive week as the US dollar continued to rally.
Could the Bank of England Postpone Hiking Rates?
The British pound (FXB) depreciated 1.8% against the US dollar (UUP) in April, and has depreciated 1.9% so far in May.
Why the Euro’s Gap with the US Dollar Is Widening
The euro-US dollar (FXE) exchange rate closed at 1.19 on May 7, with the euro depreciating 1.4% against the dollar (UUP) in May following a 2.0% decline in April.
Dollar Bears Under Pressure as Short Squeeze Continues
In April, the US dollar index posted one of its best monthly gains (2.0%) since November 2016, and it looks set to continue with the trend this month.
Is the US Economy on Track to Meet the 2018 GDP Projections?
In its most recent SEP release, the Fed upgraded its GDP growth outlook for 2018 by 0.2% to 2.7%, compared to the 2.5% growth outlook in December 2017.
Disappointing April Jobs Report: Lower June Rate Hike Odds?
For the week ending May 4, the ten-year (IEF) yield closed at 3% and depreciated by 0.8 basis points. The two-year yield (SHY) closed at 2.50%.
It’s Surprising that President Trump Isn’t Tweeting about This
The US goods and services deficit was at $49.0 billion in March, a decrease of $8.8 billion from $57.7 billion in February.
Could there be a 4th Rate Hike in the Cards?
The Bureau of Economic Analysis defines PCE (personal consumption expenditure) as the value of goods and services purchased by, or on behalf of, US residents.
Which Sector Posted Major Job Gains in April?
The US employment market could be overheating. Businesses are adding more than 200,000 jobs per month despite rising trade tension.
ADP: US Job Market Could Be Overheating
According to the ADP April National Employment Report, US private sector employment added 204,000 jobs in April.
Here Are March’s Trends in Existing Home Sales
According to the NAR’s April 2018 report, existing home sales rose 1.1% to a seasonally adjusted annual rate of 5.6 million homes in March.
What to Make of the March Increase in Building Permits Issued
The US Census Bureau and Department of Housing and Urban Development report monthly data on building permits issued in the United States.
Why a Rebound in March Housing Starts Isn’t Satisfying the Sector
The volatility in housing starts data remains elevated. Housing starts in March were reported to have risen 1.9%.
Why American Builders’ Confidence Fell 1 Point in March
The HMI (housing market index) was reported to have decreased by one point to 69 in April 2018.
What’s Next for the Yen after Global Risks Recede?
The Japanese yen (JYN) depreciated against the US dollar for a fifth consecutive week, as the US dollar continued to rally on the back of higher bond yields and the prospect of a faster rate hike pace from the US Fed.
Will the British Pound Stop Its Downward Slide?
The British Pound (FXB) depreciated by 1.66% against the US Dollar (UUP) for the week ending April 27.
Euro Depreciated despite Hawkish European Central Bank Statement
The euro-dollar (FXE) exchange rate closed the week ending April 27 at 1.2131, depreciating 1.28% against the US dollar (UUP).
Why Did the US Dollar Appreciate with Bond Yields?
The US dollar index saw one of the best weeks in over a year as the US dollar surged past many major currencies.
Key Macro Events This Week
US markets (IJH) will be tracking ongoing corporate earnings. US markets could be influenced by the multiple economic reports scheduled this week.
Are US CEOs Confident about the US Economy?
The Conference Board CEO Confidence Index increased from 63 in 4Q17 to 65 in 1Q18.
Why the Euro Slid despite the European Central Bank’s Optimism
The ECB (European Central Bank) left its policy unchanged at its April meeting, squashing any hopes for tightening in the near term.
What the European Central Bank Is Planning for Asset Purchases
The ECB (European Central Bank) made no changes to its APP (asset purchase program) at its April meeting, maintaining that its purchase rate of 30 billion euros in debt securities per month will continue until the end of September 2018 or beyond if necessary.
Why the European Central Bank Is Optimistic about Growth
At its April 26 meeting, the ECB’s (European Central Bank) governing council sounded optimistic about the European Union’s growth momentum.
Is the European Central Bank Preparing for Policy Normalization?
At its April policy meeting yesterday, the European Central Bank left policy measures unchanged.
How Higher Bond Yields Could Affect Equity Markets
The current equity market bull run has stretched beyond nine years.
Why Interest Rate Spreads Are Decreasing Again
In April, the yield spread has declined to the lowest level since the Great Recession and could decline further if inflation doesn’t accelerate.
Manufacturing Workers’ Increasing Work Hours
A large portion of the US workforce is employed by the manufacturing sector, and increasing working hours in the sector is a positive sign for the economy.
What Drove the Leading Economic Index Higher in March?
In this series, we’ll analyze the Leading Economic Index and assess whether the economic model signals any changes to the US business cycle.
Bank of Japan: Weak Data Might Mean More Easing
In the absence of any risk-off events, the Japanese yen will likely depreciate against the US dollar this week.
