fxmatters

What an extraordinary week! Share prices plunging. Billions of dollars previously unbeknown to management lost by a French bank’s trader. The Fed riding to the rescue with a huge 0.75% rate cut. The market adjusting their expectations to expect even more this week. Gold to new highs. Even US politicians coming to an agreement in election year about their own rescue package … Read Risk aversion takes hold

• 22 January 1719 – William Paterson dies, having founded the Bank of England, the first central bank in modern history.
• 26 January 1799 – President Jefferson writes “banking establishments are more dangerous than standing armies”; the current president probably agrees.
• Last 10 days of January – the NZD/JPY has depreciated 13 times in the last 20 years, including by 0.6% in 2007.

The talk now is of a US recession, and of sharply lower US interest rates. And yet the USD has not tumbled? There is good reason for that … Read When recession starts