1 May 2015
Big volatility and moves - why? - Scotiabank
FXStreet (Guatemala) - Camilla Sutton, chief currency strategist at Scotiabank explained that there has been massive position squaring this week, which likely began in the German bond market, drove markets this week.
Key Quotes:
"However the catalyst was a fundamental shift that had been building for the last month. Inflation expectations are rising in the major economies, 5yr5yr forwards are well off their lows, commodities are higher and most measures of inflation have at least stabilized."
"Even the IMF sees a materially decreased risk of deflation globally. This fundamental shift is a major change and one that impacts positioning in markets add to this month‐end, progress on Greece, liquidity issues, a one sided market, soft U.S. data and sentiment shifts and the result was significant market moves over the last several trading sessions."
Key Quotes:
"However the catalyst was a fundamental shift that had been building for the last month. Inflation expectations are rising in the major economies, 5yr5yr forwards are well off their lows, commodities are higher and most measures of inflation have at least stabilized."
"Even the IMF sees a materially decreased risk of deflation globally. This fundamental shift is a major change and one that impacts positioning in markets add to this month‐end, progress on Greece, liquidity issues, a one sided market, soft U.S. data and sentiment shifts and the result was significant market moves over the last several trading sessions."