MARKET COMMENTARY BY JOVI OVERO, BETA 2 LTD. Monday February 21 2011

The noticeable trend last week came from the bullish euro which was further boosted on speculation that the ECB will hike interest rates. Will the Euro continue with its bullish theme this week?

Last week the U.S.D fell against most of its major currency counterparts. It fell 300 pips against the euro and 250 pips vs. the pound. This was due to the disappointing economic releases from the U.S, such as the Long Term Purchases report which showed that global demand for U.S stocks, bonds and other financial assets fell in December.

Retail sales in the U.S had increased less than projected in January with purchases increasing by 0.3%, the smallest gain since a drop in June. Sales of retails were depressed by a drop in demand at building material stores and restaurants in the U.S.

This week, we have the consumer confidence, existing home sales and the preliminary GDP which will provide volatility for the USD. Today, U.S banks are closed in observance of Presidents Day.

The euro strengthened vs. it rivals on the back of an increase in risk appetite following a U.S stock market rally. This rally has boosted risk appetite in the market, and as result, increased demand for higher yielding assets such as the euro and the British pound.

The gain in the euro was also affected by a bearish dollar due to several economic reports showing that the U.S economy is recovering at a slower pace than estimated.

Lastly, the euro strength continued after ECB board member, Lorenzo Smaghi, hinted that an interest rate hike may take place soon in order to fight the rising inflation.

The Japanese Yen fell against most of its currency rivals during last week’s session, dropping about 180 pips vs. the euro and 240 pips against the GBP.

This fall was due to last weeks reduced risk aversion caused by a rally of U.S stocks boosting demand for higher yielding assets and weakened demand for safe haven currencies such as the yen.

Additionally, last week showed that Japan’s economy contracted for the first time in five quarters. GDP shrank an annualised 1.1% in the 3 months ended in Dec 31^st. As a result, China’s economy overtook Japan’s as the worlds second largest for 2010.

Crude oil was back above $90 a barrel on Mid-East unrest arresting a decline which began last week reaching a low of $83.85. The trend reversed and crude gained to 90.95 by Friday with the rally expected to continue as the violence in Libya escalates.

NEAR TERM RATE OUTLOOK FOR THE UK BY LANE CLARK, BETA 2 LTD, Friday February 18 2011

As I stated previously, BoE Governor King suggested that the inflation report committee does not have a pre-conceived idea of where rates are heading in the near term.

I am not convinced that that any rate rise will mark the start of a normal tightening cycle, however, the minutes of the MPC will provide indicators of just how likely a near term rate hike now is. If anyone joined Andrew Sentence and Martin Weale in voting for a hike, a near term rate rise will obviously look more likely.

During King’s report, his overall tone remained pretty dovish and he went to great lengths to stress the temporary nature of the factors pushing up inflation and highlighting how a single rate rise to try and pull inflation down more rapidly would be futile.

It is clear the King is at one end of the spectrum so his comments may not necessarily represent those of the committee as a whole.

Like many of my peers, I am not convinced that the inflation report should not be interpreted too literally, especially not when so much uncertainty about the outlook for inflation and growth remains. I am of the opinion that a small rise in rates would do little to boost the MPC’s credibility, but could damage the recovery.

Next weeks minutes of the recent MPC meeting will be particularly important, if it turns out the hawkish camp gathered more support in February, it may be obvious that a rate rise is on the way.

I will wait and see, though other members of my team think it is not entirely implausible that the Q4 drop in GDP may have prompted Weale to retract his call for a rate hike.

The MPC Minutes will show just how likely a near term hike is and give an accurate reading of the feelings of the committee as a whole.

If others have indeed joined the camp of Sentence and Weale, the next month could start to look pretty likely. I am expecting a vote of 3 to increase, 5 no change and Posen voting for more QE. My Director of trading, Jovi Overo, sees it as 1-7-1.

Game on.

 

Market Commentary by Jovi Overo, Thursday February 17 2011

The U.S. dollar slid against the euro following a rally in global equity markets yesterday. The rally prompted investors to turn to higher yielding assets and away from safe havens like the USD. With recent market optimism, traders may continue to see a small downward trend in the dollar as positions are unwound in exchange for riskier assets.

The U.S. dollar slipped against the EUR and CHF Wednesday, erasing some early morning gains after encouraging U.S. economic data sent traders into riskier, higher-yielding assets. By yesterday’s close, the greenback had fallen against the EUR, pushing the oft-traded currency pair to 1.3600. The dollar experienced similar behavior against the Swiss franc, closing at 0.9580.

The producer price index (PPI) rose 0.8% last month, nearly in line with the consensus forecast of 0.9%. The manufacturing sector has been steadily growing in recent months, indicating the pace of economic recovery could be picking up.

Yesterday’s economic reports bolstered U.S. Treasury yields, but higher yields weren’t enough of an incentive to get the active market participants to continue buying dollars. Instead, traders saw the upbeat news as a reason to search out riskier assets. U.S. stocks and crude oil were among the biggest beneficiaries of increased risk demand.

Looking ahead to today, the most important economic indicators scheduled to be released from the U.S. is the CPI figures at 13:30 GMT. Traders will be paying close attention to today’s announcement as a stronger than expected result may continue to boost risk appetite in the short-term.

The euro rallied broadly against most of it major currency pairs on Wednesday as U.S. stocks rose, though gains were likely temporary given doubts about the ability of euro zone members to tap bond markets.

The 17-nation common currency extended gains against the U.S. dollar and closed around 1.3600. The EUR experienced similar behavior against the GBP as the pair rose from 0.8355 to 0.8436 by day’s end.

The EUR was affected by a U.S. stock market rally and a bearish dollar. Growth in stocks led investors to buy back into the EUR, as they looked for returns on buying commodity-linked and higher-yielding currencies in yesterday’s trading.

Turning to today, traders will want to pay particular attention to inflationary and manufacturing data out of the United States. Should these figures indicate further improvements in the U.S. economy, the euro could maintain its current course, and could even push towards the 1.3700 resistance level against the greenback.

The Japanese yen saw a very bearish trading session yesterday, losing ground against all of its currency crosses. The JPY did gain mildly against the USD, however, closing around 83.50. The yen lost almost 100 points versus the EUR, closing at 113.60; and just about 30 points versus the CHF, ending the day at 1.3020.

The JPY’s trends will be affected by the rallies of its primary currency pairs today. It seems that the USD and EUR are expected to continue trading volatile today, especially against the Japanese currency.

Investors should keep a close look on the news coming from the U.S. and Canada as these economies will be the deciding factors in the JPY’s movement today. It is also advisable for traders to follow any unexpected comments coming from key Japanese governmental figures, as this is also likely to lead to further JPY volatility.

Oil prices rose to a 10-day peak on Wednesday as upbeat European and US manufacturing data reinforced optimism about economic and energy demand growth. After U.S. inventory data revealed stockpiles growing less than expected, the price for a barrel of Crude Oil jumped back above $88, where it has remained throughout today’s early trading sessions.

Manufacturing in the United States and Europe accelerated in December and growth in China and India slowed to a more sustainable level, helping to fuel a move by investors into commodity-link and higher-yielding currencies. Traders should focus on today’s manufacturing reports from the United States as these will no doubt carry a direct impact on the supply-demand aspect of the equation for oil prices.

 

JOVI OVERO BETA 2 LTD, MARKET COMMENTARY, 08/12/2010

Gold Rises to New Record High before Falling

The US dollar rallied in the New York session to close higher versus the majors while dragging down the price of commodities. An agreement between President Obama and Republican congressman to extend Bush era tax cuts spurred the dollar buying. Investors are currently eyeing budget debates in Ireland that are expected to face stiff opposition.

USD

The US dollar staged a late session rally following an agreement with Republican congressman that will allow for an extension of the Bush era tax cuts. The lower income tax rates would stand for another two years. Obama was quoted saying the compromise, “Is a good deal,” for Americans as it would extend tax cut to all Americans as well as unemployment benefits to those who have been out of work for a number of months. Moody’s Investor Services was of the opinion that the tax cut extensions will not lead to a downgrade in the US credit rating as current fiscal pressures may remain stable.

The announcement of the agreement led to a dollar rally with the EUR/USD trading as low as 1.3260, from an opening day price of 1.3336. Early in the day the pair reached a high of 1.3400 before heading lower where the current price coincides with the rising trend line on the hourly chart.

The dollar was stronger versus the Canadian dollar as well as the Australian dollar following decisions by both central banks to hold interest rates steady and monetary policy statements that suggested an easing of monetary policy.

At the end of trading, the USD/CAD closed higher at 1.0120, up from an opening day price of 1.0050. The AUD/USD was down at 0.9829 after opening the day at 0.9903.

A lack of data releases in the US may have investors looking toward Europe for FX influences. The Irish budget votes are expected to face tough opposition and could help to weaken the euro and drive traders to buy dollars. EUR/USD support and resistance come in at 1.3250 and 1.3400.

EUR

All eyes are on Dublin as the budget debate rages in the Irish parliament weighing on the euro. The debate will be highly scrutinized as the joint EU/IMF bailout package for Ireland is contingent on 5 billion euros worth of budget cuts in the debt-ridden nation. Ireland expects to receive 67.5 billion euros in aid to cover the failing Irish banking system that was backstopped by the Irish government.

Comments were made by IMF Managing Director Dominique Strauss-Kahn that another solution will be needed to solve the debt European debt crisis and authorities should not address the problem as a case by case basis.

Yesterday the euro was mixed versus the majors with the EUR/USD falling to a low of 1.3250. The EUR/CHF was higher at 1.3093, from an opening day price of 1.3074. The EUR/JPY was also up at110.67 after opening the day at 109.96.

Today traders will be watching for the passage of the Irish budget decision as well as German industrial production numbers for the month of November. Expectations are for a rise of 1.1%. An output below market expectations may hurt the value of the EUR/CHF. The next support for the pair rests at 1.3000 followed by 1.2930. Resistance comes in at 1.3200.

JPY

The dollar was up on the yen yesterday with the USD/JPY trading up from a three week low. Driving the pair higher was the extension of US tax cuts in a deal struck by US President Obama and Congress. This helped to increase expectations of economic improvement in the US economy, boosting the rate of the dollar.

The USD/JPY finished the day up sharply at 83.55 after opening the day at 82.44.

In early Asian trading, Japanese machine orders fell by 1.4% on expectations of no change. Also the Japanese current account registered a decline of 1.46 trillion. This highlights a drop in Japanese exports that may be due to both a slowing Japanese economy as well as a stronger yen. A strong local currency makes exports more expensive in overseas markets, thereby reducing export activity.

Further declines in the yen may be seen as the USD/JPY appears to be on its way to a close above the resistance level of 82.35. The next target should be last week’s high at a price of 84.40.

Oil

The price of spot crude oil moved above $90 for the first time in two years but volatile trading did not allow for the commodity to hold its gains as the price finished the day lower. The drop in price may be attributed to profit taking as traders may have had limit orders resting at the $90 level. A strengthening dollar also may have weighed on the price of crude oil.

Spot crude oil prices reached a high of $90.74 before finishing the day down at $87.94. Trading began at the price of $88.95.

Oil prices have strengthened significantly in the past two weeks, rising from a low of $80.30 to yesterday’s high above $90.

Today crude oil traders will be looking at the US weekly crude oil inventory release which is due to be released at 15:30 GMT. Market expectations are for a decline of 1.3 million barrels. A larger draw down than expected could help continue to push prices up above the $90 level until the $100 level.

Gold and Silver

Gold reached a new nominal high and silver a 30 year high as investors bought hard assets on fears of weakening paper currencies.

Gold climbed to $1430.95, a nominal high and up 0.5% since Monday. Adjusted for inflation, it is still well below its record high of $2,300 an ounce hit in 1980.

Silver moved higher to a 30 year peak, trading above $30 an ounce for the second day in a row. However, both metals slid late in trading as investors took profit.

Precious metals are often seen as a hedge against inflation or currency devaluation. The metals moved higher as there was increased appetite for risk as Barack Obama agreed to the extension of the Bush-era tax cuts for two years.

Written by Jovi Overo Beta 2

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MARKET COMMENTARY BY JOVI OVERO, BETA 2 LTD 01/11/2010

Strong Economic Data Boosts Pound

The dollar is stronger in European trading following positive economic data from both China and Great Britain.

At lunch time during the European trading session the dollar was up versus the majors. The EUR/USD is lower at 1.3960, down from an opening day price of 1.3980. The GBP/USD is trading at its opening day price of 1.6064. The USD/JPY is down at 80.40. This comes following a spike in the price with the pair climbing as high as 81.43 during the opening hours of Japanese trading. European equities were up as the DAX was trading higher by 0.25%.

Early this morning Chinese PMI numbers beat market expectations, coming in at 54.7. Economists had forecasted a reading of 53.8. The strong numbers surprised the market as economic growth typically staggers in China during the month of October.

UK manufacturing data also was stronger than expected, posting an increase to 54.9 on expectations of only 53.2. This was the first rise in the data piece since March. An increase in exports contributed heavily to the surprisingly positive data.

Monday, 1 Nov 2010

USD

The US dollar experienced a rapid spike in this morning’s trading hours following the opening of Asian equity markets. The spike initially drew concern that an intervention by the Bank of Japan (BOJ), selling their currency against the dollar, had brought about the sudden change in value, but the rapid retracement of the USD’s gains made many analysts reconsider this position.

Alternate approaches to the spike appear to either be the actions of a single hedge fund, or a trading glitch occurring during the thin market conditions of early morning trading. The issue will likely be cleared as the day wears on, but for the moment it appears unclear as to the cause of the jump.

At exactly midnight, GMT-time, the greenback rose as high as 81.41 against the Japanese yen; 1.3895 against the euro; and 1.5989 versus the British pound. Similar gains were seen elsewhere, but these three represent the largest and most significant spikes experienced this morning. What was more significant was the almost instant retracement of these gains over the hour which followed, which, as mentioned, has fuelled speculation that it wasn’t the BOJ acting behind the movement.

Today’s news events will help set the market back into order by injecting much-needed liquidity to this morning’s thin conditions. Today’s PMI figures from Britain and the United States will kick-off what is always the heaviest news week of the month. This week’s interest rate decisions and employment data, particularly Friday’s Non-Farm Payroll figures, are of the utmost importance.

EUR

The euro continues to trade higher against most of its currency counterparts. Despite a mild setback against the USD this morning, the 16-nation single currency appears to have regained all that was lost versus the greenback immediately after the sudden dip in price.

The EUR/USD pair appears poised to breach the 1.4000 mark again and this week’s news may provide enough bullishness to sustain a price above the mark. The EUR/CHF has risen sharply over the past few days as well, and seems to be hours away from breaking above 1.3800. The British pound has regained predominance over the EUR and remains one of the few currencies to have recently broken the euro’s rise. The pair trades at 0.8711, down from last week’s high of 0.8940.

The euro zone will be oddly absent from today’s economic calendar. Both Britain and the United States will be releasing highly impactful PMI data. French banks will be closed today due to the celebration of All Saints Day, which could mean somewhat thinner conditions than usual during today’s mid-day trading hours.

JPY

The sudden spike in the value of the US dollar during Asian trading hours this morning have raised questions about possible intervention moves by the Bank of Japan (BOJ). However, the pace at which the move was rescinded has many analysts positing that it may not have been the BOJ, but rather a lone hedge fund, or even a glitch not dissimilar from that witnessed a few months prior.

Of course the question of currency intervention ahead of this week’s meeting of the US Federal Reserve Board has many concerned that the US and Japan may continue in their currency devaluation war despite commitments not to do so at the latest round of G20 meetings. The Fed’s QE move may already be priced in, but countermoves by the BOJ remain elusive and unpredictable. Traders will need to keep a close eye on comments emanating from Japan this week to get a more accurate read on where these two currencies are heading.

Crude Oil

Despite the rumblings taking place throughout the Forex market this morning, the price of Crude Oil appears little touched. Crude Oil has been experiencing a price consolidation trend towards the level of $81.50 a barrel. The trend appears to have become clearer over the last few trading days as the commodity has continued to trade in an ever narrowing range between $80 and $84 a barrel.

Oil prices respond rapidly to valuations in the US dollar, but this morning’s spike carried little to no impact on the value of oil. This wasn’t surprising, however, since the move was not large enough, nor sustained long enough to substantially affect commodity prices. This week’s data, on the other hand, has the potential to shift commodity prices markedly, particularly Friday’s Non-Farm Payroll figures, which always carry a large impact on the value of the buck.

Written by Jovi Overo Beta 2

THE BUDGET! – By Lane Clark Beta 2 23/06/2010

The Budget yesterday has been perceived so far as a good thing by the City and the UK as a whole, and on the back of it the GBP has strengthened.

George Osborne unveiled the toughest budget in Britain’s peacetime history yesterday, announcing swingeing public spending cuts and painful tax hikes.

Osborne described most of the announcements as ‘unavoidable’ because of the perilous state of public finances and the mess they were left in by the previous administration.

Credit rating Fitch commented after the budget that “the Budget would strengthen confidence in the British economy and it’s AAA rating”.

As expected VAT went up to 20% from 17.5%, and this comes into force by Jan 2011.

Business welcomed plans to cut the headline rate of corporation tax by one percent every year until it hits 24 percent in 2014-15, while a 2bn levy on banks was also less onerous than expected.

Perhaps surprisingly, CGT for higher rate tax payers rose from 18% to 28%, which was far lower than the 40% that some were projecting.

The Chancellor said the threshold for higher rate taxpayers would be lowered by 1,500GBP in 2011-12, meaning those earning over 42,375GBP per annum will pay tax at 40%.

This level will be frozen for three years, dragging hundreds of thousands of taxpayers into the higher bracket.

There were also vast spending cuts which seen public sector workers higher paid employees informed that they would have a wage freeze for 2 years, and housing benefits were cut quite dramatically too.

All in all, a Budget that was probably needed and quite overdue.

It will be interesting to see how currency investors around the world view it, and our GBP.

On the growth side, Osborne thinks the economy will grow 1.2% this year, and 2.3%, 2.8%, 2.9% and 2.7% over the next four years.

Written by Lane Clark Beta 2

Market Report – 15 April 2010

GBP and the Euro Zone

Yesterday at Beta 2 Limited, we saw that the Euro was able to extend its gains against the USD following the proposed bailout plan for Greece. After dovish comments from the Fed Chairman regarding the prospects of a US interest rate hike, the Euro shot up against the Dollar.

Today, the Euro started lower against it currency counterparts as a lack of follow through buying halted its rise. German MoF spokesman Michael Offer said that the German lower House of Parliament would need to participate in a “legal authorisation” to approve the package for Greece. Based on the amount of reserves that it holds at the ECB, Germany would contribute 8.4billion Eur to the 30b aid package from the Euro zone members. In other news, the European commission warned that Portugal’s budget cut plans were a tad ambitious. However, if risks to the macroeconomic and fiscal developments materialise, additional measures may be needed.

With no significant European news events scheduled for the rest of the week, any significant movement by the Euro will be dependant on how well the US economy performs. It is expected that any better than expected news from the US will probably mean the Euro could drop further against the USD. It seems that that the Euro is fragile and it would not take much to send it over the cliff.

The pound has also been caught by a loss of follow through buying though does appear to be stronger than the Euro at this time. One of the reasons could be due to a poll from the daily telegraph which showed that the Conservatives leads the Labour Party and could win an outright majority (though polls like these are ubiquitous) in the up coming polls on May 6th. 43% of votes questioned said they would Tories, 31% the Labour Party and 20% the LibDems. This poll has eased concerns of a hung parliament and raised hopes that the UK will be more determined and able to cut the budget deficit.
U.S Dollar

The US dollar remained on the defensive yesterday after strong data from China reinforced the view of a global recovery which is gaining momentum.

US Retail sales in March rose to 1.6%, the highest in four months and beat expectations of 1.1%. Inflation data remained subdued with the headline CPI up less than expected to 2.3% YoY while Core CPI moderated to 1.1% YoY.

Following yesterday’s testimony by Bernanke, the USD tumbled against most of its counterparts most notable the Euro and the Pound, though this morning the US has surged back against the Euro up almost 0.64%.

In the testimony, Bernanke quite clearly stated that US interest rates would remain at the record lows for quite some time.

This has led investors to abandon the safe have Dollar in favour of riskier currency pairs including the Sterling, Euro, and the Aussie Dollar.

In spite of this, analysts predict solid gains for the USD today. Forecast for both the US Unemployment Claims Report as well as the TIC Long Term Purchase figure are a tad optimistic but if true the USD should be able to move higher.

Commodity currencies remained strong yesterday, though have tumbled today as investors have jumped back into the USD and JPY, as solid earnings results sent stock market futures higher. USD/CAD went through the low of 0.9976 and reached as low as 0.9960. AUDUSD also climbed to a high of 0.9358 and was set to take on the 0.9380 resistance. The Yen remained soft on risk appetite, however, today is up against all of it currency counterparts.

MARKET COMMENTARY BY LANE CLARK, BETA 2 LTD – 8th April 2010

Rates Decision Day

As most people know, today is rates decision day in both the UK and the Eurozone…

Proceedings get underway at 11am with the announcement of the BOE’s latest stance, and are quickly followed 45 minutes later with an announcement from the ECB.

So what do we expect?

Pretty much the same as everyone else. For both parties to keep their policies exactly the same. ECB will more than likely keep their rates at 1% whilst the BOE will keep their rates at 0.5% and the QE package at 200bn GBP.

It’s also reported in numerous publications today that not only will rates remain the same today but will also stay that way after the election in the UK. An election where more and more people believe the result will be a hung parliament. Which certainly would not be good news for the UK economy.

Yesterday the Euro stayed under pressure on Greece woes, including the announcement that the Greek budget deficit for 2009 will be revised higher to 12.9% of GDP.

Elsewhere, late last night both the current Federal Reserve Chairman (Bernanke), and the gent he succeeded (Greenspan) spoke to the markets.

Bernanke stayed realistic and admitted that the post financial crisis America is far from out of the woods yet. He cited a despondent employment market and a housing sector that remains very poor as two of the biggest challenges for the economy.

Greenspan on the other hand came under fire for failing to take measures to prevent the financial crisis. In a heated appearance at the Financial Crisis Inquiry Commission in Washington, Greenspan insisted reckless mortgage lending and the securitisation of home loans sparked the subprime collapse of 2007.

His comments were met with reluctance from the commission who commented that “he could’ve, he should’ve, and he didn’t do enough to regulate”.

Now that’s out of the way- the focus switches to the rate decisions today. Enjoy.

MARKET COMMENTARY – 1st March 2010

“In the end it is always easier to believe the lie”

So, nothing important happened today. 

The Pound decided to drop 3.percent today to under 1.48, the first time since May 8th after a YouGov poll suggested that an election, which has to be called by June, showed that neither Labour nor the opposition party of the Conservatives would have a majority of seats in Parliament, which would put an obstacle to efforts to cut the record deficits.

Ian Stannard, a senior currency strategist commented by saying “Sterling is really suffering and leading the way down now”. Whilst Tom Nagle, Senior Manager at Saxo Bank said “Expect a test of 1.40 within a month and as the global landscape turns ever more ugly on the back of deflation and sovereign debt concerns, a continuing flight to the US Dollar should take Sterling down below to 1.20 by the summer”.

All aboard the for the Sinking of the Pound it seems and book your seats next to Jim Rogers, former George Soros partner, who predicted that the Pound was on the brink of a collapse. This is in fact the prediction from Rogers “ The UK Pound is on the brink of a collapse which will herald a downturn worse than 2008/9, it could well happen within weeks and the British government is powerless to prevent it. And this in turn will foreshadow a global economic winter that could come before the end of 2010 and make the last two years seem like a mild spring day”. Ooooh dramatic stuff, this could be the next sequel to the disaster film 2012!!!

With the UK GDP revision coming out better than expected at 0.3, you would have thought this would have been enough for a bit of breathing space, but others have different ideas. Swiss bank UBS speculates the risk of a run on the pound, whispers of credit rating downgrades and this could be a Greece part 2. It seems that the forecast of a currency crash and then a full scale global shakedown are almost inevitable.

Is this the beginning of the end for the Great British Pound? What are we to believe? UK debt levels are as worrisome as any other country, developing or industrialised. Its budget deficit is 13%, slightly higher than in Greece. Private debt is estimated at £1.5 Trillion, or £60,000 per household, which is the highest (in relative terms) in the world. “Then there’s the trillion-pound bank bail-out, the trillion-pound public-sector pension liability, the trillion-pound public debt and those off-balance-sheet private finance initiatives schemes. If you add

up Britain’s real liabilities you find that the UK is heading for a total debt burden of several times its GDP,” summarised one analyst.

The BOE meet this Thursday and are considering an extension of its quantitative easing (QE). In light of the fall of this magnitude of the Pound commentators are suspicious that the UK Government and Bank of England are not overly concerned with a weak pound. They may very well welcome this. We all know that they are not going to increase Interest Rates and they believe that there is no point in making exports harder by strengthening the exchange rates. However, they should also consider that while a weak currency is useful for devaluing exiting debt, it can also have the unintended consequence of scaring off investors thus making it difficult to fund future debt, but in the end, it is always easier to believe the lie…