One of the big themes my colleagues and I have flagged up since late 2007 is the eventual rebalancing of the United States’ external accounts. There are several reasons – both domestic and external – why we believe the US current account deficit will continue to narrow over the coming years. We list these below,… [Read more]
The stellar import performance seen in recent months, which tipped the trade account into a US$7.2bn deficit in March, is in line with China’s booming domestic demand story. However, it seems to me like the rise in imports is at least partly a reflection of the Chinese government’s desire to diversify its dollar reserves into… [Read more]
Risk watchdog’s call of a 25bps hike in Mexico’s benchmark interest rate to 8.00% on July 18, based on poor inflation data and rising price expectations, proved correct, and supports the long-held bullish stance towards the Mexican peso. The hawkish decision by Banxico helped the peso break five-year highs of MXN10.22/US$, pushing on towards my… [Read more]