News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.



Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Please try again
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Wall Street
More View more
Real Time News
  • Currency exchange rates are impacted by several factors. Are different world leaders a contributing factor? Find out here:
  • Many people are attracted to forex trading due to the amount of leverage that brokers provide. Leverage allows traders to gain more exposure in financial markets than what they are required to pay for. Learn about FX leverage here:
  • What are some trading takeaways from 2020, as we jump into the new year? Find out with your free guide here: #DailyfxGuides
  • Trading Forex is not a shortcut to instant wealth, excessive leverage can magnify losses, and sentiment is a powerful indicator. Learn about these principles in depth here:
  • Risk management is one of the most important aspects of successful trading, but is often overlooked. What are some basic principles or risk management? Find out from @PaulRobinsonFX here:
  • Copper is on track to make a sixth consecutive monthly gain as prices inch towards its all-time high. The global backdrop remains supportive despite a short-term pause in the rally. Get your market update from @FxWestwater here:
  • Retail trader signals still hint that the Dow Jones and S&P 500 may be at risk, placing the focus on year-long rising trendlines to see if dominant upside biases hold.Get your market update from @ddubrovskyFX here:
  • The path for the Japanese Yen seems to favor the downside looking at a majors-based index. USD/JPY may rise within its Ascending Channel, but there is some scope for a healthy correction. Get your market update from @ddubrovskyFX here:
  • The British Pound’s recent slip lower against its major counterparts may prove short-lived. Key levels to watch for GBP/USD, GBP/JPY, GBP/CHF and EUR/GBP. Get your $GBP market update from @DanielGMoss here:
  • Senate Democrats reach deal on jobless aid -BBG
Monetary Policy from Fed, ECB, BoE Priming Speculative Drop

Monetary Policy from Fed, ECB, BoE Priming Speculative Drop

John Kicklighter, Chief Strategist

Talking Points:

  • A gradual shift in global monetary policy towards normalization is slowly dawning on the speculative excess of the market
  • The Fed's Taper and the S&P 500 reaction is a good indication of how markets are likely to react on a global basis
  • With the BoE and BoC speaking of hikes, the ECB testing the waters and speculation doing the rest; change is upon us

How are the DailyFX analysts' top trading ideas for 2017 faring? How would you adapt their views to make for better trade opportunities at the mid-point of the year? Sign up for the DailyFX Top Opportunities of 2017 Trading Guides.

The global tides are changing. The rise of extraordinary accommodation in the form of extreme rate hikes and the implementation of large scale asset programs (LSAPs or more often referred to as QE) marked a turning point in the history books for finance. The coordinated effort helped stave off what could have been a collapse of the global financial markets - and the unexplored economic fallout that would no doubt follow. However, as the recovery extended and the fear receded, the need for the exceptional accommodation was more suspect. Monetary policy was kept in a bid to generate the acceleration in growth that never seemed to take, to impart a questionable advantage in trade and eventually simply to offset the influence of influential counterparts. Competitive monetary policy - often referred labeled currency wars - was employed not just by the more scrappy central banks dependent on their larger counterparts, it was driven by the biggest groups in the world. And, the cost of this effort is starting to become more explicit.

There is a downside to everything. Stimulus and extraordinarily low rates is no exception. One of the more troubling side effects for the central banks themselves is the recognition that their efforts are losing traction. The more recent efforts to introduce and escalate existing programs has seen a marked decline in net gain for growth, inflation, employment and local capital markets. With the policy authorities stretching the bounds of what they have at their disposal, they have put themselves in a position that fighting another onset financial crisis or economic recession will be difficult if not impossible. The speculative market that placed its faith in the limitations of these seemingly infallible groups are in an even more troubling position. They have taken risk exposure well beyond the recommended dosage. They are heavily dependent on the low volatility environment that the central banks have been able to leverage to compensate for the extreme lack of return - it is arguable that these same elements have pushed them to take this risk.

Now, as growth solidifies at lackluster levels and the outlook for inflation picks up; the world's largest banks are changing course. Some are explicit about their intentions and moving aggressively - like the Fed which has hiked rates and laid out its stimulus rundown plan. Others are taking cautious but deliberate steps - like the BoE and BoC which have stated the next moves are likely to be rate hikes. Then there are those that are arguably the most critical to this equation as the rudder for complacency and ill-earning speculative confidence - including the ECB and BoJ. The former has attempted to test the waters with ambiguous rhetoric to see how the market reacts. Each time, the ECB has said something close to a hawkish view, volatility has churned and scared them off. That said, they cannot hold off forever. For the BoJ, a penchant for surprise will likely leave them at the tail of the pack; but FOMO effects all. The full turn is still a ways off, but the markets anticipate and speculation. To get a sense of what the market's reaction will be, we need only look back to the Fed's Taper plans and execution in 2014 and how drained the lift from the S&P 500. We discuss the big picture implications of global monetary turning the corner amid growing evidence that it is underway in today's Strategy Video.

To receive John’s analysis directly via email, please SIGN UP HERE.

Monetary Policy from Fed, ECB, BoE Priming Speculative DropMonetary Policy from Fed, ECB, BoE Priming Speculative DropMonetary Policy from Fed, ECB, BoE Priming Speculative Drop

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.