Will the Chinese Year of the Goat see a prolonged weakness in the yuan by the People’s Bank of China? (PBOC) The yuan fell 3% against the U.S. dollar between October 2014 and mid-February 2015, and lost 4% during the first five months of 2014.
Early North American trade has been riveting thus far as equities are turning higher, the euro has bounced somewhat after falling below 1.05, and the U.S. dollar isn’t faring as well as it has so far this week.
To me, avalanches have always been one of the most dramatic and terrifying of natural phenomena. In general, avalanches tend to occur after a seemingly small disturbance, such as new precipitation, animal movements or a large rock dislodging, but there are usually advance warning signs that an avalanche is more likely to occur.
I noted one week ago that with the euro buying $1.10, the IB Probability Lab using prices for currency options derived a 5% chance of the unit sinking to parity by June and a 10% chance of arriving there by September.