Junior Finance Analyst, Steno Research

Ulrik Simmelholt

Junior Finance Analyst

Macro and Geopolitical Research House

Steno Research

Steno Research is a new macro and geopolitical research house. We are based out of Copenhagen, Denmark, but have an international team and a strong network of sources and partners around the world. The team is lead by Andreas Steno, previous global head of strategy at Nordea Bank, and Mikkel Rosenvold, former chief consultant in the Danish Ministry of Finance.

Macroeconomics

<ul><li>We’ll start today’s 5 things with a look at the central bank outlook for in 2024, then we’ll address the troubles for OPEC.</li><li>We move over to talk about China and afterwards Ukraine for some geopolitics.</li><li>Finally, we’ll end this year’s last 5 things with a crypto outlook.</li></ul>

We’ll start today’s 5 things with a look at the central bank outlook for in 2024, then we’ll address the troubles for OPEC.We move over to talk about China and afterwards Ukraine for some geopolitics.Finally, we’ll end this year’s last 5 things with a crypto outlook.

External broker reports(aggregated public sources), Scotiabank

Scotiabank

External broker reports(aggregated public sources)

Scotiabank’s global foreign exchange strategy team provides in-depth regional insights and macro-economic analysis for G10 and advanced economies, Asia Pacific, and Latin America. Find technical and fundamental strategy reports focused on trade ideas, market risks, and the unfolding macro outlook. Content available is external broker reports authored by a third party outside the Smartkarma network and has been aggregated by an online aggregator through publicly available sources and is displayed by Smartkarma in this format for user's convenience and general informational purposes only. Content does not constitute investment or financial advice and Smartkarma makes no representation or warranty regarding its accuracy or contents. Original third party author retains all copyright and other proprietary rights in the content. Access or use of third party links not controlled by Smartkarma are at the user's own risk.

FX & Rates

<ul><li>High beta currencies have done well over the past week.</li><li>A crack in the Fed’s hawkishness at last Wednesday’s FOMC boosted risk appetite and lifted pro-cyclical currencies.</li><li>Top of the pack over the last five trading sessions is the NOK (helped by the jump in Brent around Red Sea focus, for sure), followed by the ZAR, AUD, SEK and NZD.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

High beta currencies have done well over the past week.A crack in the Fed’s hawkishness at last Wednesday’s FOMC boosted risk appetite and lifted pro-cyclical currencies.Top of the pack over the last five trading sessions is the NOK (helped by the jump in Brent around Red Sea focus, for sure), followed by the ZAR, AUD, SEK and NZD.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

FX Snapshot - Stretched Valuation Does Not Preclude More USDCAD Losses

Head of Research and Global Chief Strategist, Steno Research

Andreas Steno

Head of Research and Global Chief Strategist

Cross Asset Strategy

<ul><li>Markets are pricing in heavy cuts for next year as inflation keeps coming in soft, making a soft landing the base case for the bulls, but everything comes at a price.</li><li>But how are assets likely to perform if the market narrative is correct and yields will indeed come down in a continued bull-steepening fashion, which in our view is the most likely scenario in H1 2024?</li><li>We have pulled out some of our cross-asset beta studies from our data-library to provide you with an overview of how assets perform during various yield curve regimes.</li></ul>

Markets are pricing in heavy cuts for next year as inflation keeps coming in soft, making a soft landing the base case for the bulls, but everything comes at a price.But how are assets likely to perform if the market narrative is correct and yields will indeed come down in a continued bull-steepening fashion, which in our view is the most likely scenario in H1 2024?We have pulled out some of our cross-asset beta studies from our data-library to provide you with an overview of how assets perform during various yield curve regimes.

Bull Steepening Watch – Is Lower Yields Really What Risk Assets Want?

<ul><li>Traders moved to cut overall USD longs further still in the past week’s CFTC data.</li><li>The prior week’s report showed aggregate, speculative USD longs were effectively halved ahead of Thanksgiving.</li><li>This week’s data shows another, sizeable reduction in net USD longs of USD3.3bn, taking the aggregate USD long held by Non-Commercial (speculative) accounts to just USD1.8bn. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Traders moved to cut overall USD longs further still in the past week’s CFTC data.The prior week’s report showed aggregate, speculative USD longs were effectively halved ahead of Thanksgiving.This week’s data shows another, sizeable reduction in net USD longs of USD3.3bn, taking the aggregate USD long held by Non-Commercial (speculative) accounts to just USD1.8bn. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Weekly CFTC Sentiment Report - Speculative USD Longs Reduced Further

<ul><li>The holiday-delayed CFTC data were worth the wait. The overall change in positioning reflected in this week’s data was significant.</li><li>Aggregate USD longs held by NonCommercial (speculative) traders were slashed in half ahead of the Thanksgiving break; overall speculative USD longs dropped USD5.4bn in the week to USD5.1bn.</li><li>In addition, data showed Real Money (institutional accounts) boosting net USD shorts by around USD7bn while Leveraged (hedge) Funds raised their aggregate USD longs by around USD500mn.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

The holiday-delayed CFTC data were worth the wait. The overall change in positioning reflected in this week’s data was significant.Aggregate USD longs held by NonCommercial (speculative) traders were slashed in half ahead of the Thanksgiving break; overall speculative USD longs dropped USD5.4bn in the week to USD5.1bn.In addition, data showed Real Money (institutional accounts) boosting net USD shorts by around USD7bn while Leveraged (hedge) Funds raised their aggregate USD longs by around USD500mn.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Weekly CFTC Sentiment Report – Traders Slash USD Longs

New Zealand

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

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NZD (NZD BGN CURNCY)

Five Things We Watch For In 2024

The thing to watch is probably employment numbers and once the labor markets start turning bad, expect CBs to cut in a hurry (especially if it is...

Steno Research

FX Snapshot - Stretched Valuation Does Not Preclude More USDCAD Losses

High beta currencies have done well over the past week. A crack in the Fed’s hawkishness at last Wednesday’s FOMC boosted risk appetite and lifted...

Scotiabank

Bull Steepening Watch – Is Lower Yields Really What Risk Assets Want?

Let’s run through each asset class to see where to put your eggs if a bull-steepening of the yield curve continues into 2024.

Steno Research

Weekly CFTC Sentiment Report - Speculative USD Longs Reduced Further

Traders moved to cut overall USD longs further still in the past week’s CFTC data. The prior week’s report showed aggregate, speculative USD longs...

Scotiabank

Weekly CFTC Sentiment Report – Traders Slash USD Longs

The holiday-delayed CFTC data were worth the wait. The overall change in positioning reflected in this week’s data was significant.

Scotiabank

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