FX Strategist

Greg Gibbs

Fundamental analysis of topical themes in FX

Amplifying Global FX Capital

Amplifying Global FX Capital was founded in 2015 and is fully owned by Greg Gibbs. It is a registered company both in Australia and Colorado, USA and is a licensed in Australia to provide financial services.

We are producing a regular trading view orientated macroeconomic analysis of topical themes in global financial markets, with a particular focus on foreign exchange. We invite you to view an “executive summary” of these reports in “AmpGFX Reports” under our “Research” menu.

These reports are drawn from the analysis of Greg Gibbs and inform the capital management he undertakes on behalf of the company. The trading performance is posted periodically on our website. We aim to build our company into both a research and capital management business. We are currently in the planning phase for managing capital for wholesale customers.

Greg Gibbs has spent his working life of more than 26 years in financial markets, beginning in 1989 at the Reserve Bank of Australia, after completing a Bachelor of Economics Degree (Honours) at the Australian National University. He has been a CFA Charterholder since 2005. He has worked in Sydney, Singapore, New York and London for major global banks and presented on foreign exchange markets to major financial institutions and companies around the world, and maintained a high profile in the financial media.

Before Amplifying Global FX Capital, Greg was the Head of Asia Pacific Market Strategy at the Royal Bank of Scotland based Singapore. He now resides in Breckenridge Colorado.

FX & Rates

It is getting harder to know where to turn with political risk in the UK palpable. A dual citizenship debacle in Australia, NAFTA negotiations hanging over the CAD outlook, a significant change in policy direction in New Zealand, German coalition negotiations, and political uncertainty has never been far from mind in the US in the Trump era.  Japan is a source of stability, supporting its equities, not its currency.

It is getting harder to know where to turn with political risk in the UK palpable. A dual citizenship debacle in Australia, NAFTA negotiations hanging over the CAD outlook, a significant change in policy direction in New Zealand, German coalition negotiations, and political uncertainty has never been far from mind in the US in the Trump era.  Japan is a source of stability, supporting its equities, not its currency.

Political Risk for a Number of Currencies (AUD, NZD, GBP and CAD)

The RBNZ must revamp the monetary policy outlook this week facing a political minefield.  The starting point for inflation is significantly higher than previously forecast, and it is now close to target.  The exchange rate has fallen to a low since mid-2016 and is likely to place some upward pressure on inflation. The economy is sending mixed signals with booming employment growth, and a tightening labour market, but a slump in business confidence generated by political uncertainty and a weaker housing market.  Retail sales have been surprisingly weak, even though consumer confidence has remained solid.  The new government has proposed more spending on infrastructure and affordable housing, but wants to slow immigration and further dampen the housing market.  The RBNZ may feel wary of antagonising the new government as it prepares to change the RBNZ mandate and add a monetary policy board with outside directors.  You might say the new ‘Acting’ Governor Spencer, leading his first MPS and press conference, has been thrown in the deep-end.  He may need to bring forward rate hike forecasts modestly and risk unwanted appreciation in the NZD.

The RBNZ must revamp the monetary policy outlook this week facing a political minefield.  The starting point for inflation is significantly higher than previously forecast, and it is now close to target.  The exchange rate has fallen to a low since mid-2016 and is likely to place some upward pressure on inflation. The economy is sending mixed signals with booming employment growth, and a tightening labour market, but a slump in business confidence generated by political uncertainty and a weaker housing market.  Retail sales have been surprisingly weak, even though consumer confidence has remained solid.  The new government has proposed more spending on infrastructure and affordable housing, but wants to slow immigration and further dampen the housing market.  The RBNZ may feel wary of antagonising the new government as it prepares to change the RBNZ mandate and add a monetary policy board with outside directors.  You might say the new ‘Acting’ Governor Spencer, leading his first MPS and press conference, has been thrown in the deep-end.  He may need to bring forward rate hike forecasts modestly and risk unwanted appreciation in the NZD.

RBNZ Governor Spencer Thrown into the Deep End

Major corrective moves may be underway in EUR and NZD. Further weakness may also be in stall for CAD and AUD.  In the case on EUR, CAD and AUD, long positions and bullish sentiment leave them vulnerable to position-squaring.  The EUR has moved too far from its yield disadvantage, and it is not as cheap as some might have you believe.  The Bank of Canada has moved into a watch-and-wait mode. The political shockwave in NZ may be the catalyst for a major realignment in the NZD’s long-run over-valuation.  AUD is suffering from weaker house price growth in Australia and China, the RBA is badly missing its inflation target, and its politics are hardly a shining example for any country.

Major corrective moves may be underway in EUR and NZD. Further weakness may also be in stall for CAD and AUD.  In the case on EUR, CAD and AUD, long positions and bullish sentiment leave them vulnerable to position-squaring.  The EUR has moved too far from its yield disadvantage, and it is not as cheap as some might have you believe.  The Bank of Canada has moved into a watch-and-wait mode. The political shockwave in NZ may be the catalyst for a major realignment in the NZD’s long-run over-valuation.  AUD is suffering from weaker house price growth in Australia and China, the RBA is badly missing its inflation target, and its politics are hardly a shining example for any country.

The NZD has taken a hit on the formation of a un-proven left-leaning coalition, after nine years of a right-leaning, essentially one-party led government that oversaw a return to significant budget surplus and stable solid economic growth.  At least some change was always coming, since the election on 23-September, as NZ First held the balance of power and was set to enter government. While the market should not have seen this outcome as a big surprise, perhaps the reality has hit home, creating further downside risk for the NZD.  We expect the new Labour-led government under new PM Ardern to provide solid leadership that keeps reasonable control over the budget.  There are reasons to see some positives for the economy, as Labour will pursue increased social and infrastructure spending.  However, Labour is planning policy changes that may significantly further weaken the housing market and cut immigration.  These measures are likely to feed through to a weaker economic outlook and a weaker NZD.  In our view, the NZD has been over-valued for some time; perhaps the change in government may prove to be a catalyst that sets the currency on a new weaker course.

The NZD has taken a hit on the formation of a un-proven left-leaning coalition, after nine years of a right-leaning, essentially one-party led government that oversaw a return to significant budget surplus and stable solid economic growth.  At least some change was always coming, since the election on 23-September, as NZ First held the balance of power and was set to enter government. While the market should not have seen this outcome as a big surprise, perhaps the reality has hit home, creating further downside risk for the NZD.  We expect the new Labour-led government under new PM Ardern to provide solid leadership that keeps reasonable control over the budget.  There are reasons to see some positives for the economy, as Labour will pursue increased social and infrastructure spending.  However, Labour is planning policy changes that may significantly further weaken the housing market and cut immigration.  These measures are likely to feed through to a weaker economic outlook and a weaker NZD.  In our view, the NZD has been over-valued for some time; perhaps the change in government may prove to be a catalyst that sets the currency on a new weaker course.

Surprisingly, futures positioning in the USD moved to a new high in net shorts on 3-Oct, despite the rebound in the USD over the last month.  It seems the market is sceptical that the recent rise in the USD will last, and has been in a ‘sell-the-rally’ frame of mind.  However, the rise in the USD has been consistent with a higher short and long-term yield advantage.  US economic reports, including the labor data on Friday, support the notion that the USD can rise further.  The USD has rallied in part due to a rejuvenated push for tax reform.  However, it appears that the market retains a significant risk premium (discounting the USD) to account for US political uncertainty.

Surprisingly, futures positioning in the USD moved to a new high in net shorts on 3-Oct, despite the rebound in the USD over the last month.  It seems the market is sceptical that the recent rise in the USD will last, and has been in a ‘sell-the-rally’ frame of mind.  However, the rise in the USD has been consistent with a higher short and long-term yield advantage.  US economic reports, including the labor data on Friday, support the notion that the USD can rise further.  The USD has rallied in part due to a rejuvenated push for tax reform.  However, it appears that the market retains a significant risk premium (discounting the USD) to account for US political uncertainty.

Skeptical Market Is Very Short US Dollars

New Zealand

The New Zealand dollar is the official currency of New Zealand.  

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NZD (NZD BGN CURNCY)

Political Risk for a Number of Currencies (AUD, NZD, GBP and CAD)

It is getting harder to know where to turn with political risk in the UK palpable. A dual citizenship debacle in Australia, NAFTA negotiations...

Greg Gibbs

RBNZ Governor Spencer Thrown into the Deep End

The RBNZ must revamp the monetary policy outlook this week facing a political minefield. The starting point for inflation is significantly higher...

Greg Gibbs

Major Moves Afoot (EUR, CAD, NZD & AUD)

Major corrective moves may be underway in EUR and NZD. Further weakness may also be in stall for CAD and AUD. In the case on EUR, CAD and AUD,...

Greg Gibbs

New Zealand Dollar Charts a New Course

The NZD has taken a hit on the formation of a un-proven left-leaning coalition, after nine years of a right-leaning, essentially one-party led...

Greg Gibbs

Skeptical Market Is Very Short US Dollars

Surprisingly, futures positioning in the USD moved to a new high in net shorts on 3-Oct, despite the rebound in the USD over the last month. It...

Greg Gibbs

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)