Forex Month End : Just Pull The Wool Over Your Eyes Or Be A Black Sheep
When we started 2015, the entire world was waiting for the great global economic divergence and thus diverging policies from the central banks.
8 weeks into 2015, the divergence is showing up. Yes. US IS LAGGING behind in terms of economic outperformance with economic data underperforming in 2015 so far while Europe has not seen better numbers in over a year for some optimists in WSJ to suggest a turning point at last. http://www.wsj.com/articles/a-turning-point-for-eurozone-growth-heard-on-the-street-1424963311?mod=rss_Heard_on_the_Street
An example would be the high economic confidence emitting out of Europe against the decline in US inflation which we are seeing for the first time, excluding the period of Lehman’s collapse, since 1995.
Plotting the graphs of economic surprises, Europe and US are diverging even as the USD continues on its path of strength against the EUR dollar in the Dollar (DXY) Index.
We can surmise it is not about the economy as much as it is about the FOMC and their decision to hike interest rates which will now hinge on a meeting by meeting basis. And Janet Yellen is the shepherdess of global markets – https://tradehaven.net/market/market-thoughts-on-cny-little-bo-peep-dont-lose-your-sheep/