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.

Macroeconomics

S interest rates have fallen significantly this year (-36bp) reducing the USD yield advantage.  This has been matched by the GBP and CAD, but AUD and NZD rates have been much more stable than previous episodes of global risk aversion. The Fed is sticking to its outlook for gradual policy tightening, but weak growth is expected to be reported in Q4, activity indicators are weak heading into 2016, medium and longer term inflation expectations are down sharply, and the only plank left supporting rate hike forecasts is the solid labor market.  However, recent unemployment claims have drifted up, and a considerable pause in US rates appears likely.  The US economy has been dragged back to the pack to some extent by the deep fall in oil prices.  While the US energy sector is not all that large, it is much more cyclical than OPEC countries, and activity in this sector has been a factor slowing the US economy.   We may be moving into a phase where confidence in the US economy is waning.  This may tend to weaken the USD in 2016.  Global risk aversion and weaker commodity prices may also weaken commodity and emerging market currencies, but if perceptions on US monetary policy change enough, even these currencies may recover at some point.

S interest rates have fallen significantly this year (-36bp) reducing the USD yield advantage.  This has been matched by the GBP and CAD, but AUD and NZD rates have been much more stable than previous episodes of global risk aversion. The Fed is sticking to its outlook for gradual policy tightening, but weak growth is expected to be reported in Q4, activity indicators are weak heading into 2016, medium and longer term inflation expectations are down sharply, and the only plank left supporting rate hike forecasts is the solid labor market.  However, recent unemployment claims have drifted up, and a considerable pause in US rates appears likely.  The US economy has been dragged back to the pack to some extent by the deep fall in oil prices.  While the US energy sector is not all that large, it is much more cyclical than OPEC countries, and activity in this sector has been a factor slowing the US economy.   We may be moving into a phase where confidence in the US economy is waning.  This may tend to weaken the USD in 2016.  Global risk aversion and weaker commodity prices may also weaken commodity and emerging market currencies, but if perceptions on US monetary policy change enough, even these currencies may recover at some point.

EM PM, Ecstrat

Emad Mostaque

EM PM

Ecstrat

Ecstrat is a consultancy advising on asset allocation between global equity markets, with a focus on the intersection of governments, geopolitics, governance and markets.
 
Over the past few years and more especially since the Great Financial Crisis (GFC), investors have become more focused on short-term market movements and real-time returns and have consequently neglected the analysis of the underlying structural themes that underpin longer term performance.
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More specifically we believe that the evolution of governance-based relationships between investors, controlling shareholders, labour and the state is one of the primary determinants of both relative and absolute performance between individual equity markets.
 
We will endeavour to provide investors with some of the context surrounding governance-related issues which encompass many different disciplines including history, economics and political science, as well as the financial metrics which are the most obvious manifestation of the structural characteristics of each market.
 
We will pay particular attention to the shifts and potential inflection points for governance in individual markets as these are often the best lead indicators for both economic and market performance.

Thematic (Sector/Industry)

In the wake of what looks to be the second most deadly terror attack since 9/11 (the first being the horror that was Beslan), we look at the&nbsp;local and regional ramifications.&nbsp; It does not make for cheerful reading as the terrorist threat continues to evolve and extend its tendrils, with a&nbsp;nuanced response needed. Egyptians are working hard and I hope they pull through. This also highlights the severe geopolitical risk in the region, which I believe is the highest in a decade, even as OPEC spare capacity is at 08 lows.

In the wake of what looks to be the second most deadly terror attack since 9/11 (the first being the horror that was Beslan), we look at the&nbsp;local and regional ramifications.&nbsp;  It does not make for cheerful reading as the terrorist threat continues to evolve and extend its tendrils, with a&nbsp;nuanced response needed. Egyptians are working hard and I hope they pull through.  This also highlights the severe geopolitical risk in the region, which I believe is the highest in a decade, even as OPEC spare capacity is at 08 lows.

As we head towards the US payrolls report, US rates have continued to drift up this week, building on the rise last week on a less dovish than expected FOMC. Provided the payrolls report is not too far from expected, the EUR may reassert its recent downtrend.&nbsp; The spreads between EUR and USD interest rates have moved to new lows since 2007.&nbsp; Oil prices appear to be shaking off the bear-market, rejecting moves much below $50 and energy sector equities have performed well recently, offering support for the CAD.&nbsp; The RBA is keeping a rate cut up its sleeve for now.

As we head towards the US payrolls report, US rates have continued to drift up this week, building on the rise last week on a less dovish than expected FOMC. Provided the payrolls report is not too far from expected, the EUR may reassert its recent downtrend.&nbsp; The spreads between EUR and USD interest rates have moved to new lows since 2007.&nbsp; Oil prices appear to be shaking off the bear-market, rejecting moves much below $50 and energy sector equities have performed well recently, offering support for the CAD.&nbsp; The RBA is keeping a rate cut up its sleeve for now.

AmpGFX - Oil may be stabilizing, rate pressure on EUR

Private market valuations for tech companies have increased sharply in recent years, with an outbreak of so-called "unicorns" (startups valued at over $1bn) and the median seed-stage valuation in the USA now an eye-popping $5.8m leading to fears of a bubble.In contrast the tech IPO pipeline has remained relatively moribund as investors have eschewed public markets (indeed, IPOing is now almost a sign of weakness (!)).If we look at some of the key drivers of these private market flows, we can see that it may actually be different this time and that public market valuations may be set to follow in the coming years.

Private market valuations for tech companies have increased sharply in recent years, with an outbreak of so-called "unicorns" (startups valued at over $1bn) and the median seed-stage valuation in the USA now an eye-popping $5.8m leading to fears of a bubble.In contrast the tech IPO pipeline has remained relatively moribund as investors have eschewed public markets (indeed, IPOing is now almost a sign of weakness (!)).If we look at some of the key drivers of these private market flows, we can see that it may actually be different this time and that public market valuations may be set to follow in the coming years.

This note looks at the background of the recent Ankara bombing, the political situation in Turkey and its position in the region.The note starts with an analysis of who benefits from the political violence we have seen reintroduced to Turkish politics and how it is sharpening the differences between various groups inside Turkey (the final conclusion is al Qaeda benefits most, ignored by most).We then consider the political and religious background of the AKP and how it impacts its current actions and the efficacy of the security forces is then considered, finishing with some thoughts on the Battle of the Five Armies that we are now seeing in Syria and why Russia has now entered the fray.The conclusions are somewhat somber, but it feels like we may be close to a bottom in some key areas with a path to ruin unlikely and some level of political stability to return to Turkey with my core view still being an AKP majority for November 1st, with a CHP-coalition next most likely, both of which would cause the market and currency to rally in the next few weeks.

This note looks at the background of the recent Ankara bombing, the political situation in Turkey and its position in the region.The note starts with an analysis of who benefits from the political violence we have seen reintroduced to Turkish politics and how it is sharpening the differences between various groups inside Turkey (the final conclusion is al Qaeda benefits most, ignored by most).We then consider the political and religious background of the AKP and how it impacts its current actions and the efficacy of the security forces is then considered, finishing with some thoughts on the Battle of the Five Armies that we are now seeing in Syria and why Russia has now entered the fray.The conclusions are somewhat somber, but it feels like we may be close to a bottom in some key areas with a path to ruin unlikely and some level of political stability to return to Turkey with my core view still being an AKP majority for November 1st, with a CHP-coalition next most likely, both of which would cause the market and currency to rally in the next few weeks.

United States

Vanguard FTSE Emerging Markets ETF is an exchange-traded fund incorporated in the USA. The ETF tracks the performance of the FTSE Emerging Markets Index. The ETF holds large and mid-cap stocks in emerging markets around the world. Brazil, Russia, India, Taiwan, China, and South Africa are among the markets included. The ETF weights these holdings based on market capitalization.

Vanguard FTSE Emerging Markets ETF (VWO US)

Vanguard FTSE Emerging Markets ETF (VWO US)

Confidence in Fed Hikes Waning

S interest rates have fallen significantly this year (-36bp) reducing the USD yield advantage. This has been matched by the GBP and CAD, but AUD...

Greg Gibbs

Egypt on the brink

In the wake of what looks to be the second most deadly terror attack since 9/11 (the first being the horror that was Beslan), we look at the local...

Emad Mostaque

AmpGFX - Oil may be stabilizing, rate pressure on EUR

As we head towards the US payrolls report, US rates have continued to drift up this week, building on the rise last week on a less dovish than...

Greg Gibbs

Why large funds are piling into PE & VC

Private market valuations for tech companies have increased sharply in recent years, with an outbreak of so-called "unicorns" (startups valued at...

Emad Mostaque

Ankara: Cui Bono?

This note looks at the background of the recent Ankara bombing, the political situation in Turkey and its position in the region.The note starts...

Emad Mostaque