Australian Dollar

The Australian dollar is still trading below 60 cents: Bonds are bid after the opening yield spike: XJO is off a breezy 4%: As Big Iron sells: Big Oil has been annihilated: Big Gold is hanging in.

By Chris Becker  It’s all about the stimulus with stock markets lifting overnight in the wake of combined fiscal packages from various governments to offset the economic cost of the coronavirus impact.

Via the excellent Damien Boey at Credit Suisse: With the AUD/USD down at 61c, we thought it instructive to see how it lines up with macro fundamentals.

Another volatile day on Asian stock markets, this time to the upside for most outside China, as a modicum of stability returns to risk markets following the epic falls on Wall Street overnight.

Cross-posted from FTAlphaville: Few things are as likely to imbue us with that sense of global financial crisis déjà-vu than a dollar swap line.

By Chris Becker  Panic and fear are ruling markets, with stock markets likely to see restrictions in trading soon if this epic volatility continues.

Here we go again.

Via FTAlphaville: There’s growing evidence that markets think central banks have reached the limits of their capabilities.

By Chris Becker  Friday night saw volatility violently veer the other way with big surges on stocks and selloffs in safe havens like gold, Treasuries and Yen. Oh and Bitcoin which crashed down to $4000 before rebounding 50% (not a typo) to almost $6000!

DXY took off Friday night and is suddently in the frame for its traditional safe haven melt-up: The Australian dollar was trashed to GFC lows: Gold has begun liquidating.

It’s still ugly out there with Asian equities falling sharply but not as fast as Wall Street overnight, but all stock indices are now in bear market territory for the year.

By Chris Becker  Panic has set in on risk markets around the world with shares suffering their worst one day loss since 1987 as Wall Street plummets 10% in a single session.

It’s getting ugly out there with the ASX200 having its worst day since 2008, falling nearly 8%, while other Asian equities are off by about half that as Trump enacts a European travel ban.

By Chris Becker  Fear is back as another packed night of volatility where the WHO declared the coronavirus a pandemic, Wall Street lost its shi(r)t, while bond markets went haywire and actually sold off with a big jump in still-depressed yields.

Well that was a short lived bounce, as risk assets fall across the region despite more fiscal and monetary stimulus nods and suggestions overnight.

By Chris Becker  Fears are fettered with fiscal fiddling overnight with the rebound in Asia extending into the US session, although European bourses remain extremely nervous and put in scratch sessions.

Well here comes the bounce, with risk assets suddenly coming back to life as happens in major retracements when there’s no one left to sell too.

Just in time for disaster: Yes, folks, here we are at the great Australian calamity and the sleeping RBA just restored a positive carry into the Australian dollar.

By Chris Becker  Everything is fine.