G7 officials used to say that foreign exchange markets should be driven by fundamentals. It struck some as vacuous. What else could drive the largest part of the capital markets, a $6.6 trillion a day turnover prior to the crisis but macro? The challenge is really which macro factors should determine exchange rates. There seems to …
This Great Graphic was created on Bloomberg and depicts Japan and US 5-year credit default swap indicative pricing. Japan’s 5-year CDS is denominated in dollars and is represented by the white line. The US CDS is the white line and is priced in euros. As can be seen by looking closely at the recent performance, …
Great Graphic: US and Japan Five-Year Credit Default Swaps Read More »