Currency

Chancellor: Was I totally wrong about bitcoin?

12 Jan 2021

Three years ago, this column argued the cryptocurrency wasn’t money, resembled the gold prospector’s fabled sardine tin, and faced a total wipeout. Bitcoin promptly shed more than two-thirds of its value. Now it’s back from the dead and trading at twice its peak. What happened?

Yuan internationalisation season re-opens

28 Dec 2020

The threat of U.S. dollar sanctions on Chinese banks has thrown the lacklustre use of its currency for overseas trade and investment into harsh relief. A recovering economy and rallying renminbi clear the way for reformers to liberalise further, if conservatives let them.

Review: Money’s history proves credibility is king

18 Dec 2020

Jacob Goldstein’s book traces currency’s messy journey from Mesopotamian IOUs to bitcoin. He shows it has always been based on shared beliefs and trust, and is closely connected with the development of political freedom. Turns out, curbing power may be key to making money work.

Janet Yellen will bring back benign dollar neglect

30 Nov 2020

President-elect Joe Biden’s Treasury secretary pick is going to have less sway over the currency than she did as Fed boss. Yellen is likely to stick to bland mantras and focus on getting fiscal policy right. That will be a welcome change from the tack taken under Donald Trump.

Viewsroom: What Biden bodes for money and markets

7 Nov 2020

Without a clear Senate majority, the former vice president will need to tack to the center when he occupies the White House. For Wall Street that’s a bullet dodged. For other industries, it’s a mixed bag. For multilateral institutions, it’s an improvement from Donald Trump.

Guest view: Ways to defuse currency wars

13 Oct 2020

Weak economic activity is giving countries an incentive to use exchange rates to win a competitive edge in trade. Mark Sobel, a former U.S. Treasury official, argues that the world’s biggest economy is no innocent bystander this time round and explains how to calm tensions.

Corona Capital: Kraft Heinz, U.S. poverty

15 Sep 2020

Concise views on the pandemic’s corporate and financial fallout: The food giant is boosting advertising outlays, even as it continues cutting costs; and the poverty rate in the United States hit a low at the end of 2019, according to new data, only to run into a Covid reversal.

Corona Capital: Palantir presents

9 Sep 2020

Concise views on the pandemic’s corporate and financial fallout: Potential shareholders have had their first look at the data company ahead of its planned direct listing later this month. One of the more memorable moments was boss Alex Karp making his pitch from a nature trail.

Turkey has only one way to avert new crisis

13 Aug 2020

The lira has fallen by almost a fifth against the dollar this year. The central bank’s reserves are depleted and President Tayyip Erdogan dislikes interest rate rises. Accepting a gradual tightening of monetary policy is his one hope of avoiding a rerun of the 2018 crash.

Euro moves a step closer to becoming a safe haven

22 Jul 2020

The EU’s 750 bln euro fund makes the bloc more resilient and creates easily traded common bonds, boosting the single currency’s appeal. Yet political splits are only patched up. It may take new crises to fix them. Only then will the euro stand a chance of supplanting the dollar.

Zimbabwe launches quixotic war on modern finance

14 Jul 2020

The government is blaming South African insurer Old Mutual and phone-based payment systems for a currency collapse. Its fondness of money printing is the more likely culprit. Attacking the stock market and mobile money will damage savings and confidence, and spur capital flight.

Crack in Hong Kong dollar peg is invisible

12 Jun 2020

U.S. investor Kyle Bass has bet the currency’s greenback link will snap within 18 months. The peg is vulnerable if Beijing’s new security law scares capital away. But that looks to be a long-term trend, and authorities for now are restraining a rally. Shorters are short on time.

Corona Capital: Instacart stocks up

11 Jun 2020

Concise views on the pandemic’s corporate and financial fallout: Grocery-delivery firm and lockdown beneficiary Instacart tops up on capital while the getting is good.

Dollar’s crisis crown is slipping

3 Jun 2020

The greenback has fallen to its lowest in nearly three months. The scale of Fed Chair Jerome Powell’s stimulus has calmed nerves and lured investors into riskier assets. The more confident money managers are that he has their back, the more the U.S. currency will weaken.

Turkey’s policy sins will be visited on companies

7 May 2020

The lira fell to a record low against the dollar. The central bank set interest rates too low in the past, then depleted FX reserves to limit the exchange-rate damage. Its war chest is too small to prevent further depreciation. Disaster looms for firms with foreign-currency debt.

Dollar-backed crypto shapes up as pandemic winner

22 Apr 2020

Cash is neither contactless nor clean, drawbacks that might have pushed money into big-name bitcoin. Instead, investors have focused on so-called stablecoins like Tether and USD Coin, linked to the U.S. currency. A revamped Libra even has a shot if Facebook gets out of the way.

Strong dollar hits renewables when they’re down

30 Mar 2020

Plunging oil prices have already made wind and solar power less attractive. But a coronavirus-led weakening of emerging market currencies also pushes up the dollar cost of new projects. That puts a brake on growth just when the opposite is needed to hit carbon reduction targets.

Beware battered sterling’s rebound

24 Mar 2020

The currency is up from 35-year lows against the dollar. The worst of the pummelling is over, partly due to official efforts to sate a hunger for the greenback. But such demand is still worryingly high and options prices show deep gloom about the pound’s outlook. Caveat emptor.

Corona Capital: Religious aid, Ad-spending slump

23 Mar 2020

Concise views on the pandemic’s corporate and financial fallout: U.S. Vice President Mike Pence wants Americans to donate to religious institutions to bolster community aid. But churches have their own fiscal problems. Plus: TV ad revenue look set for a pounding.

Next G7 headache is a disorderly currency market

19 Mar 2020

The dollar is surging amid a dash for cash. Exchange rate swings are verging on the sort of unruly moves that policymakers say they dislike. Public expressions of displeasure can be the first line of defence. If these don’t work, official sales of the U.S. currency may be needed.