Opinion/Trading
Kiwi ripe to strengthen
The New Zealand dollar’s recent performance is based on more than just US dollar weakness. Sue Trinh, currency strategist at the Bank of New Zealand in Wellington, looks at what will be driving the currency in 2004
The year ahead in Asia
US dollar weakness and regional equity market strength look set to remain the main drivers of Asian FX in 2004, according to Tim Condon, chief economist, Asia for ING Financial Markets in Hong Kong
Hedging a short euro/dollar position
For European exporters needing to hedge exposure to the freefalling US dollar, a six-month forward may be the best solution, suggest Eric Ohayon, European head of FX structuring, and Kai Fisher, European head of FX corporate sales, at Bank of America in…
The ghost of Bentsen
The lessons of history may help in assessing the dollar’s fortunes in 2004, says Peter Luxton, economic adviser at Informa Global Markets in London
The kick-knock solution for cable
Trevor Carr, manager in FX options at HBOS Treasury Services in London, suggests a creative solution for a UK parent company wanting to hedge against continuing sterling strength
More dollar pain before H2 rebound
The dollar will suffer much more pain in the near term before rebounding in the second half of 2004, says Larry Kantor, global head of economics and market strategy at Barclays Capital in New York
Euro/Swiss franc risk reversals
Simple risk reversals are the best way for Swiss investors to manage low domestic interest rates and a softening Swiss franc versus the euro, says David Durrant, chief currency strategist and senior economist for the Americas at Julius Baer Asset…
Dollar crisis? Think again
The US current account deficits are sustainable, and the dollar correction has largely come and gone, says Frank Gong, chief FX strategist at Bank of America in Hong Kong
The ratchet structure: improving with the market
With more complex options available and increasing customer sophistication, strategies in vogue are changing swiftly. David Popplewell and Richard Summerbell in RBS’s FX options structuring group in London say they are seeing a distinct shift in…
Aussie dollar nears its cyclical peak
The Australian dollar’s rally is almost over and investors should look to take profits or reduce long positions in the coming months, says Karen Pringle, senior currency strategist at ANZ Investment Bank in London.
Non-exporters still have exposure to currencies
Options could be the answer for a manufacturing company facing the twin problems of foreign competitors undercutting its prices and of the companies it supplies being less successful with an appreciating currency. Alex Barrett and Demetri Papacostas, of…
Euro/yen to trend lower
Eurozone competitiveness versus the yen has fallen sharply since a peak in 2001, and the current level of euro/yen is likely to fall again by mid-2004, says Steven Saywell (right), director of currency strategy at Citigroup in London
E-dealing requires better pricing
Efficiency gains available from technology are being undermined by pricing discrepancies, says Cognotec chairman Brian Maccaba.
Soft Accumulator: improving hedging levels
BACKGROUND: European importers who need to buy US dollars are not complaining about the current euro/dollar rate of exchange.
Yen and the art of market cycle maintenance
The yen resurgence that began this summer is still in play. But with the Japanese authorities still sporadically intervening in the currency markets, this upward path may meet some sharp setbacks. Simon Derrick, head of Bank of New York's currency…
A strengthening yen is no barrier to Japan's exporters
A stronger yen isn't proving to be the disaster for Japanese exporters that many predicted. Tohru Sasaki, chief FX strategist at JP Morgan Chase Bank in Tokyo, looks at why a strengthening Japanese currency doesn't necessarily mean decreasing revenues…
Hedging Taiwan dollar risk
Exporters exposed to movements in the Taiwan dollar must hedge by using the non-deliverable forwards market. Michael Image, FX options structurer for northeast Asia at Standard Chartered Bank in Hong Kong, suggests a zero upfront premium solution, which…
Managing sterling risks
Trading cable or euro/sterling off fundamentals is fraught with risk because they are primarily driven by trends in euro/dollar, says Steven Englander, Barclays Capital’s New York-based chief FX strategist for the Americas. But a properly constructed…
US abandons strong dollar policy -- but will Asia?
The G-7 communiqué at the IMF/World Bank annual meetings in Dubai marked the end of the US administration’s ‘strong dollar’ policy. But does it also signal a change in Asia’s preference for a strong dollar?
Risk management for Kiwi wine exporters
With the booming popularity of New Zealand wines in the US, the threat of Kiwi dollar appreciation looms large over the New Zealand wine-making industry. Wes Price in ANZ Investment Bank’s consultative risk management group in Melbourne, describes a…
‘Discount forward’ for hedging euro/sterling
With euro/sterling forecast to strengthen next year, Danny Goldblum, from HSBC’s global FX structuring team in London, proposes a solution to give a UK corporate that imports from Europe the protection of a forward contract at an improved rate
Seasonal yen patterns
Dollar/yen’s statistically significant seasonal pattern bottoms in mid-October and rises through mid-January. Greg Anderson, senior FX strategist at ABN Amro in Chicago, recommends looking for a spike in the flat period to come and selling into it
Changing fortunes
September’s G-7 communiqué was a departure from its usual bland messages, and Asian currencies have reacted accordingly. Jimmy Koh (right), head of economics treasury research at United Overseas Bank in Singapore, explores some of the likely future…
Alternative hedging for European exporters
European exporters could use major currencies’ volatility and liquidity to manage euro appreciation against emerging markets currencies, says Christine Lefort, global head of the structuring and marketing desk at Credit Agricole Indosuez in Paris