Incremental Change

Quite often in financial markets we are prepared for the step change. The day a company announces their results; the day a debt payment is unexpectedly missed; the day a central bank hikes rates. Lately, we have had to get used to the day of an election result. Sometimes the step change isn’t an exogenous event, but just the price of an asset itself. For example Tuesday was the biggest one day downmove in EUR/USD this year. Given we started the year just above parity, it’s somewhat surprising it took until we hit the 1.2000 levels . . .

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