USD on a One Month High as Fed Tweets
The main takeaway from yesterday's market was the strengthening of the U.S. dollar most notably against the Japanese Yen and the Euro as the result of the positive economic indicators to come out of the United States and the Federal Reserve comments on QE which have increased U.S. Treasury Yields.
The biggest story on Wall Street was published on the New York Times Op-ed section. Greg Smith a VP with Goldman Sachs publicly resigned leaving a bad mark on the investment bank which has prompted an official reply as a memo directed to all the bank's employees. Did the last ethical GS banker walked out? or did bonus season not leave enough in his stocking?
Fitch Ratings revised the United Kingdom's AAA rating with a negative warning, from a previous stable outlook, as it could lose the investment grade if it does not stick to the current debt cutting path. Moody's issued a similar warning a month ago on the back of some sectors asking for a looser fiscal stance. The current British government was elected on the promise of eliminating the record high 11 percent budget deficit and progress in the first two years have been slow due to Eurozone crisis.
Analysts are debating on what adjetive to add to the slowdown of the Chinese economy. Some have used hard. Adrian Mowat from JPMorgan“China is in a hard landing. Car sales are down, cement production is down, steel production is down, construction stocks are down. It's not a debate anymore, it's a fact.” Or perhaps it's a long landing as Michael Pettis mentions the long debate focused on political reform to adjust the growth model.
You can follow the Fed now on twitter: www.twitter.com/federalreserve
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