Press Review: Is Dollar Next? Investors Reassess After Swiss Shock: Currencies
Is Dollar Next? Investors Reassess After Swiss Shock: Currencies
After Switzerland shocked markets by scrapping its currency cap, investors are beginning to ask whether a policy surprise may be lurking for the dollar, too.
Samson Capital Advisors LLC said the Swiss move, which sent the franc surging as much as 41 percent against the euro last week, was "a good reminder" of the risks of following the herd, just as speculators pushed bets on a dollar rally to a new high. A shock from the Federal Reserve, such as raising interest rates less quickly than investors expect, may derail the greenback after it advanced to the highest in a decade, State Street Global Advisors Inc. warned.
Brent crude oil rises above $48.50, but outlook remains weak
(Reuters) - Oil prices edged up on Wednesday in a further sign of support around current levels, but analysts said the outlook for the next six months remained bleak due to oversupply.
Oil fell as much as 5 percent on Tuesday after the International Monetary Fund cut its 2015 global economic forecast and key producer Iran hinted prices could drop to $25 a barrel without supportive OPEC action.
Prices stabilised on Wednesday, with traders pointing to buying this week whenever benchmark Brent crude LCOc1 dropped towards $48 a barrel.
Draghi Bond Buying More Welcome in East Europe Than Switzerland
Unlike in Switzerland, eastern Europe has reasons to cheer Mario Draghi's bond-buying push.
Policy makers from Poland to Hungary (HUCPIYY) met at a conference in Vienna on Tuesday, two days before the European Central Bank is due to discuss monetary stimulus that may trigger inflows into currencies such as the Swiss franc. For eastern Europe, the move may help keep deflation at bay and economic growth ticking over, trumping the risk of asset bubbles, bankers and analysts said.
ECB bond buying would "clearly be a positive," said Piroska Nagy, an economist at the London-based European Bank for Reconstruction and Development, which has invested to rebuild the region since communism fell. "Monetary easing can have a positive impact on the economies that are linked to the zone conducting this policy."