News

FX Monthly December 2019 >> The volatility void

  • 11.12.2019
  • FX Monthly

QCAM Insight

The volatility void – Despite increased uncertainty, global FX volatility declined this year. The main forces behind this seeming contradiction were central bank efforts to combat instability and market participants selling volatility. These may well continue in 2020, but there is no guarantee. Global currency markets are vulnerable and political shocks, in particular, could disturb the calm. Our assessment.

The macro perspective

2020: Another year in limbo? – What awaits us in the New Year? According to our most likely scenario, we have to be prepared for “more of the same.” Growth should remain positive but modest. The central banks will not change course for the time being. And politics will keep us busy. Our expectations.

FX market talk

Looking ahead: FX in the 2020s – As we enter a new decade, the balance sheets of the issuers of government-backed currencies – the central banks – look very different from just a decade ago. Not only are they much larger as a share of GDP, but they now contain a far more diverse set of assets. The old rules are being amended. We enter the 2020s with central banks apparently emboldened to tackle a broader range of problems, possibly even including climate change! And the door has opened to central banks even experimenting with digital versions of their currencies. Our outlook on the FX market in the 2020s.

Download: FX Monthly December 2019

Follow-Up results

This is next in your query
FX Monthly January 2020 >> What to watch for in 2020

As eventful as 2019 was, it didn’t move currency mar­kets very much. So, what’s in store for 20...» more

FX Monthly December 2019 >> The volatility void

Despite increased uncertainty, global FX volatility declined this year. The main forces behind this ...» more

FX Monthly November 2019 >> Is it time to sel...

There are some encouraging signs that the global slowdown has bottomed out - financial markets are a...» more

FX Monthly October 2019 >> Emerging markets r...

Emerging markets already lost their luster a few years ago thanks to some country-specific problems ...» more