Currency Outlook


What Happened

  • The Buck escaped with a half percent rise in August despite a big downward swing last week
  • Euro fortunes changed the end of the month, allowing recovery from its lowest level since November
  • Pound lost 1.0% of its value as economic indicators revealed a slowdown
  • Emerging-Market currencies pulled off a comeback with a faster than expected recovery in economic activity
  • Federal Reserve officials noted they were seeing enough signs of economic improvement to consider tapering before end of the year

Tempus’ View

  • Fed plans for tightening policy are complicated by deficient job creation
  • Expect Euro volatility as we head into German elections and post-Merkel EU
  • September will test oil prices after the International Energy Agency (IEA) said it overestimated its demand for the year
  • U.S. agenda for infrastructure spending delayed as Congress members remain hesitant to give the go-ahead
  • China’s difficult third quarter could spark further doubt globally, causing dollar spikes

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