Collinson FX Market Commentary: October 22, 2013 - Markets exhausted

San Francisco - 18ft International - Day 3, 11 September 2013

Collinson FX market Commentary: October 22, 2013

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The drama of the last couple of weeks has played out and left the markets exhausted. The only economic data released overnight in the US, was Existing Homes Sales, which declined 1.9% and set off a decline in Home Builders.

The September Jobs Report is due out tonight, after delays due to the Government shutdown. The Government shutdown and the Debt Ceiling crises has empowered the Fed with a further reason to resist the reduction of their boundless expansion of the money supply. The QE Infinity has been a snowball on a steep decline with $85 Billion being added to liquidity every month. It now appears unlikely that Bernanke will attempt to commence the taper, which will result in a dim view of his reign historically.

His successor, Yellen, is a Democratic Dove and will gleefully extend the supply of money thus undermining the Dollar and asset values. This will result in a monetary form of redistribution of wealth..... Central Bank Socialism!

Currencies remained steady with the EUR 1.3680 and the GBP 1.6150 reflecting the weakness in the Dollar. Risk appetite remains strong and has the associated currencies moving towards recent highs, with the AUD trading 0.9650 and the KIWI slipping back to 0.8420. US Monetary policy will continue to undermine the US Dollar thus supporting currencies, assets and equities.

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