Log in to our mid-week North American Markets overview, where we examine the current themes in North America and provide an overview of indices and currency performances.
The past seven days, if not the past month, have been thoroughly volatile.
And this hasn’t been the case without the effect of influential catalysts.
President Trump announced that Kevin Warsh will replace Fed Chair Powell as his term ends in May 2026, and this, combined with some 7-sigma volatility in the Metals Market, particularly Silver, which tumbled from $120 to $71 in a single day.
Combine this with volatile US-Iran developments (military assets are packed in the region, recent drone attacks, …) and it is spectacular to see US Stock Benchmarks holding near their all-time highs.
In our past week’s edition, we explored the post-Greenland Crisis USD drop to 4-year lows, but this theme now looks far gone.
The Dollar has been rebounding since the low 95.00 handle, back solidly above 97.00, in what resembles a key test of its resilience, leading to swift moves in major FX pairs, with EUR/USD falling back well below the 1.20 level.
The reason for the Greenback’s rebound has been a mix of risk-averse sentiment and Warsh’s nomination, which quickly halted the selloff.
A friend of the Trump Administration, it will be tough to say whether he remains the Hawk he was baptized as when he left the Board of Governors in 2011 – he might just be turning dovish to help his case amid harsh demands from the President, but the FOMC remains a voting committee.
Discover: The Fed Chair has been picked: Who is Kevin Warsh?
Despite all the madness, Stocks remain resilient and are notably subject to some strong rebalancing flows.
Monday’s US Manufacturing PMI beat, which collided with fear of elevated AI/Tech valuations from last October, led to a swift rotation towards more traditional sectors. This theme had been emerging for a while, but seems to be gathering some strength now.
