What Determines FX Rates? - SNBCHF.COM
The effects of so-called “currency wars” and other central bank actions are small compared to the long-term impact made by these five catalysts, which include credit cycles, trade balance, differences...
View ArticleExplaining price movements in FX rates
We indicate the main factors that influence FX rates in the longer term. We explain the movements of currencies based on these factors.See it on Scoop.it, via Foreign Exchange Theory
View ArticleFX Theory: Understand Terms of Trade and Price-Adjusted Trade Balances -...
Exports and imports typically fluctuate with a rising or falling currency. When a currency appreciates then exports and imports fall when calculated in the local currency, and with a weaker currency...
View ArticleCurrency Wars: How to Push and Talk Down Your Currency? -SNBCHF.COM
Direct or indirect intervention is credible only in countries where domestic asset prices are undervalued and CPI/asset price inflation are no issues. Otherwise they create medium-term risks.See it on...
View ArticleFX Theory: Currencies of Countries with High Economic Freedom, Immigration...
Economic freedom, immigration and high savings are main drivers for strong currencies. Switzerland, Singapore, Norway, Sweden and in the future even Germany are examples. Strangely most are in...
View ArticleFX Theory: Interest Rate Parity - SNBCHF.COM
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View ArticleThe Holy Grail of Long-Term Currency Movements: Crowther's Balances and...
former "The Economist" Geoffrey Crowther wrote on balance of payments development over time: Young debtor phase, mature debtor, debt repayment phase, young, then mature creditor, asset liquidator...
View ArticleThe Real Mean Reversion for Currencies
We are of the strong opinion that an FX rate for certain countries does not matter in the long-term. The reason can be found in comparative cost theory and a so-called "Real Mean Reversion".See it on...
View ArticleThe Asset Market Model -SNBCHF.COM
The Asset Market Model implies that a currency will be in higher demand and should appreciate in value, if the flow of funds into financial market of the country such as equity and bonds markets...
View ArticleThe Main FX Trading Strategies - SNBCHF.COM
Carry Trades, Central Bank Interventions, Fundamental Data, mean reversion, Momentum Trades, Overshooting, trend followingSee it on Scoop.it, via Foreign Exchange Theory
View ArticleFX Theory: Wealth and International Investment Position -SNBCHF.COM
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View ArticleFX Theory: Balance of Payments Model -SNBCHF.COM
The balance of payments model states that a currency valued based on balance of payments. The currency with a positive balance of payments must appreciate,See it on Scoop.it, via Foreign Exchange Theory
View ArticleFX Theory: Carry Trade and Reverse Carry Trade | SNB & CHF
This page discusses two closely related concepts: the carry trade and the reverse carry trade.See it on Scoop.it, via Foreign Exchange Theory
View ArticleInflation, Central Banks and Interest Rates -SNBCHF.COM
In this chapter we connect three related concepts: inflation, central banks and interest rates.See it on Scoop.it, via Foreign Exchange Theory
View ArticleReal Effective Exchange Rate, Swiss Franc, Yen and Renmimbi
The weighted average of country's currency relative to index or basket of other major currencies adjusted for inflation.See it on Scoop.it, via Foreign Exchange Theory
View ArticlePurchasing Power Parity -SNBCHF.COM
An economic theory that estimates the amount of adjustment needed on the exchange rate between countries in order for the exchange to be equivalent to each currency's purchasing power.See it on...
View ArticleFX Theory: The relationship between Current Accounts Surpluses and the Carry...
The EUR/USD is going on its longest winning streak for a long time. Since May 27, it has improved from 1.2850 to 1.3396 and is approaching 1.34. What are the reasons?See it on Scoop.it, via Foreign...
View ArticleRicardo's Comparative Cost Theory, Heckscher-Ohlin Model and the Product...
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