Craig Erlam

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Last quote by Craig Erlam

With this kind of momentum and almost two weeks to go until the vote, not only is this not going to be the breeze that May anticipated when she called the snap election last month, it could yet turn into a humiliating defeat for the Conservative leader and her party.feedback
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NEW May 27 2017 OPEC
We can learn a lot about a person if we know what types of things he or she talks about or comments on the most frequently. There are numerous topics with which Craig Erlam is associated, including Federal Reserve, England, and market. Most recently, Craig Erlam has been quoted saying: “The FTSE 100, which ordinarily would be feeling the pain of this, is actually trading a little higher this morning. A second day of selling in the pound - this time driven by the latest poll numbers - is more than compensating for the weakness in energy stocks.” in the article Sterling hits three-week low, FTSE gains as Conservative lead slumps.
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Craig Erlam quotes

Traders appear to be in wait and see mode at the start of the week, with attention firmly on the central bank meetings this week, most notably the Federal Reserve on Wednesday when we'll find out if policy makers successfully guided market expectations in the right direction or went too far.feedback

Today's U.S. jobs report was more than adequate to justify a rate hike next week, assuming of course that the markets have correctly interpreted the Fed's very deliberate hawkish delivery over the last few weeks. It's difficult to find anything to be down about in the jobs report, with job creation being well above the 12 month average and far exceeding what the Fed deems to be good enough.feedback

The Fed's blackout period and the build up to this week's big data point – the U.S. jobs report – has offered the opportunity for some reflection for investors. The last few weeks has seen the focus switch from Donald Trump's plans to revitalize the U.S. economy with tax cuts, substantial infrastructure spending and deregulation back to the Fed, partly because we still have little idea of what the former will entail and partly because the Fed suddenly decided to send a coordinated message that it plans to raise interest rates.feedback

While it's understandable that these things take time to plan and implement properly, markets have been way ahead of the game since Trump's victory and there comes a time when we need to know exactly what they're rallying on.feedback

Political risk remains a major concern for traders, with Donald Trump's unpredictability, the Brexit debate in parliament and the French election all creating a rather unsettling environment for traders.feedback

In the absence of a press conference with Chair Janet Yellen following today's announcement, investors will be left to pour over the statement that it released alongside the decision to see whether views have changed on the path of interest rates this year since the last meeting. Given that the Fed is none-the-wiser when it comes to President Donald Trump's spending and tax plans, I would imagine the views of policy makers will be unchanged since the middle of December and they will reiterate an intention to hike three times.feedback

The one revelation that stood out was the intention to put any deal before parliament, which in theory should tip the balance slightly further away from a hard Brexit. This triggered a rally in the pound, which in turn was the catalyst for the short squeeze that followed.feedback

Should earnings continue on the current trajectory then inflationary pressures should continue to build and enable the Fed to raise interest rates three times this year as planned, even in the absence of a large fiscal stimulus package from a Trump government.feedback

I would be surprised if we're not trading above 20,000 before the end of the year. The Trump rally has stalled a little in recent sessions but so far, I'm seeing few signs that we're going to see the year out on a negative note.feedback

Of course, in very quiet periods such as this, these things can often be increasingly difficult to predict.feedback

The ECB announced today that it will begin tapering its asset purchases ... in a clear sign that it is reaching the limits of what it is willing to do under the bond buying program.feedback

Moves in oil have been a little wild again recently, with the build up to the OPEC meeting offering the usual mix of rhetoric that leaves traders none the wiser about whether a deal is likely to be struck.feedback

Markets continue to price in a more active Federal Reserve in the coming years, starting with a likely rate hike next month which is now more than 90% priced in by the markets. The yield on the U.S. 10-year Treasury is now around the same level it was this time last year when the Fed was preparing its first hike in almost a decade and about to forecast four more this year, which didn't exactly go to plan.feedback

Trump's speech following the victory was hugely influential in yesterday's sudden U-turn, as he focused more on unity and the need to spend to get the economy growing again. These policies combined with his desire to deregulate and lower taxes are all very market-friendly.feedback

Investors are keen to focus on the positive aspects of a Trump Presidency rather than some of the more worrying pledges made during the campaign.feedback

When the dust settles will depend on the reaction of Trump and the Fed. Markets have been sent into a frenzy because of poor positioning and the worrying rhetoric of Trump in the lead-up to the election. If both respond quickly, we could see some calm return the markets relatively quickly, as we did after June 23. Whether this applies to the peso will very much depend on what he has to say regarding NAFTA (North American Free Trade Agreement).feedback

While Trump slightly soothed some concerns in his victory speech, uncertainty remains over what kind of a U.S. he plans to lead.feedback

The market turbulence that a Trump victory looks likely to bring will deter the Fed from hiking next month.feedback

Brexit was a hard lesson for many, and it's still in the recent memory.feedback

It's hard to know what damage the reopening of the investigation did to Clinton's chances.feedback

The lead-up to the U.S. presidential election was always expected to be lively but the events of the last couple of days has seriously taken its toll on investor sentiment, as is clearly evident across a number of asset classes again today.feedback

The resurgence of Donald Trump in the polls so close to election day has seriously rattled investors. It's been clear for some time now that markets would much prefer the stability that a Clinton victory would bring for the U.S. economy and the reaction over the last 24 hours or so since the polls started to change so dramatically just confirms this.feedback

We know the Italian banking system is extremely fragile, it's responsible for around one third of the bad loans in the entire euro area region so it's not just a base of what will happen to Deutsche Bank and how can politicians safeguard this. I think there is a domino effect concern here and the worry is if Deutsche Bank fell many would follow.feedback

This is a massively systemically important bank, not just in Germany but in the eurozone as a whole. Aside from the fact that the bank is so big and is probably too big to fail, it really does re-ignite those concerns about the banking region in the euro area as a whole.feedback

Equity indices are lower across the board, with the decline in commodities taking its toll. Even without the decline in commodity prices, these indices continue to look toppy at the moment.feedback

Obviously, that could all change and investors have previously jumped at the opportunity to abandon the rate hike ship but I doubt that will happen today. Three of the 10 voting FOMC members dissented at the last meeting, all of whom are permanent voters, which would strongly suggest that a majority is not far away, not with a number of other policy makers appearing to lean that way, including Chair Yellen herself.feedback

The cause of the crash in the pound is still unknown, with a number of factors probably at play including a fat finger trade, very low liquidity, a large number of stops being triggered and algorithms exacerbating the move.feedback

The election in November is one of the biggest risk events facing the markets this year and the way markets responded to the first debate makes it clear which outcome is more favourable. Clinton appeared to edge the first debate which has provided a lift for investors, albeit only a slight one as the polls remain extremely close and the campaign has a long way to go.feedback

I struggle to get too carried away until we get a confirmed deal. There's been too many false dawns with regards to output agreements.feedback

The Federal Reserve blackout period is now upon us, giving traders a week to speculate on the impact of what has been said and the few pieces of data we get between now and the decision next Wednesday. While a hawkish consensus does appear to be building among the committee, the absence of some key policy makers from this makes a hike at the meeting next week very unlikely.feedback

We think the right price over the next couple of years – we are pretty close to the right price – is in the fifties. That is where supply and demand gets balanced. While the decline in inventories is believed to be due to temporary factors, it was enough to briefly push Brent crude back above $50 and while we're seeing a small correction today, the upward pressure may remain in the short term.feedback

The obsession with a Fed rate hike has developed over the last couple of years, starting with the central bank wanting to begin the tightening process at a time that many in the markets believed was wrong, to now being in a position when its credibility is constantly being called into question.feedback

Markets never have been convinced about a rate hike this year but these reports have once again tipped the balance back in favor of a March 2017 move, rather than December, while September is only 15 percent priced in.feedback

The FTSE is underperforming in the session driven by a combination of a stronger pound and further downside pressure on commodities.feedback

The pound is flying. Not only did the market not expect such a jump, it was barely expecting any improvement at all, just a slight recovery from the knee jerk response in July.feedback

The second half of the year is going to be very challenging for U.K. corporates. Not only are they contending with possible recession in the U.K. and more prolonged slowdown, the uncertainty factor surrounding Brexit leaves planning for the future a very difficult task.feedback

The pre-prepared text from Yellen's speech at Jackson Hole today didn't necessarily offer much in the way of surprises but it did confirm one thing, there is now a clear and public hawkish consensus building within the Fed and Chair Yellen is on board.feedback

Fischer didn't necessarily state when the Fed has decided to hike rates, but his remarks seemed to be alluding that a rate hike might be 'round the corner.feedback

It wasn't exactly a big surprise to see confidence in both sectors take a hit, but what was a concern was the size of the hit to the services sector, the main engine of growth for the UK economy. If we continue to see these kinds of figures in the coming months, the economy could be headed for recession before the year is out.feedback

Financial markets throughout the night have been chaotic to say the least and this may continue as the day progresses. All eyes will now be on central banks around the world to see how they respond to these market developments, particularly the Bank of England and the Bank of Japan.feedback

The polls are likely to make people rather uneasy and we can see that quite clearly today in the pound.feedback

The Fed's decision to convey a much firmer hawkish tone has certainly woken people up to the possibility that rates could rise over the summer and with that, the markets have perked up as well.feedback

With oil now trading at its highest level since early December and showing little sign of easing up, despite no deal being reached in Doha and the strike in Kuwait being resolved, I wonder whether what we're seeing here is partially a demand side story, with Chinese data having improved as of late, and partially an assumption that further supply disruptions are on the horizon.feedback

It will be interesting to see whether Draghi reverts back to old tricks and tries to talk down the euro in the absence of being able to actually use policy tools in order to drive it lower.feedback

There are signs that markets are finding their feet again. Of course, this could just be the calm before the storm which is why we may see investors proceed with caution in the next couple of days.feedback

I think we're going to be looking at a much longer period of pain for Greece. The rate of the decline in unemployment is still going to be extremely slow, especially compared to the rate that it increased over the last couple of years. So while it's a positive thing that we are seeing in Greece – and if you compare it to where we were say two years ago it is a hugely positive thing – it's such a long road ahead for Greece and a lot more pain to come.feedback

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