Daily Note – Drachma Anyone?


US: Dollar reigns supreme

Eurozone: Catch-22 in Greece



Good morning,

Déjà vu all over again!

In the three weeks leading up to the March FOMC, EUR/$ went from 1.14 to 1.05, a move that began on Feb. 26 with a core CPI for the US that was above consensus. The recent move lower in EUR/$ (which I talked about yesterday) came after a squeeze in the ECB QE trade (so the Bund sold-off, DAX down and EUR/$ higher). This started oddly enough on Apr. 29 (the day of weak US Q1 GDP). Both the up and down cycle for the Euro/$ are starting to feel a bit similar.

Again, above-consensus US core inflation took EUR/$ down on Friday last week and a decent durable goods report Monday continued the theme of markets again playing catch-up with the Dollar.

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Global Macro-Daily Note 28th May 2015


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