Your browser is out of date

This website has been built for modern browsers, yours is many years out of date and as a result, your experience of this website will be poor.

Please upgrade your browser and pop back.

Thanks.

Market Reports

8:49am, January 3rd 2019

Panic overnight as multiple FX pairs flash crash…

Widespread panic crossed currency markets last night after numerous FX pairs crashed. Some of the big movers were USD/JPY which saw an almost 4 big figure (400pip) move. For the second most actively traded currency pair in the market, which usually sees daily turnover in excess of $1 trillion, this is a monster move. The Aussie dollar and Turkish lira also saw huge moves lower which were most extreme against the Japanese yen (c. -7%). The pound also felt the effects; GPBUSD plunged to a low of $1.2425 while the pound hit €1.0960 against the euro.

Markets have somewhat calmed down since the initial move around 22:30 last night. There are a number of factors which have been linked to the move. In all cases where such moves occur (a familiar one may be the GBP flash crash in 2016) there’s usually never one cause. To set the scene, just after the New York close (9pm UK time) Apple released a rare revenue warning citing a lack of Chinese demand as one of the key factors. This sent stock market futures tumbling and renewed fears over a wider-global slowdown. Markets became increasingly jittery from here – 22:30 UK time is a period where liquidity is exceptionally thin. Europe is getting ready for bed while the US are leaving their offices and Asia has still not arrived at the desks. Further to this, it’s still holiday season with many participants not back to full-flow. Today has additionally been a national holiday in Japan so liquidity was even lower than usual. The consequence being – smaller sized trades create much larger moves across currency pairs. Looking at specifics – the volume distribution traded in the Japanese yen around that time, it appears JPY/Turkish lira saw c.23% of the volume. It’s believed some big stop losses in this currency pair could have been that key initial trigger.

Today’s trading action will be dominated by further concern over Apple and global growth, mixed with discussion over last night’s FX moves. Data-wise, UK construction PMI, US ADP jobs data and US manufacturing/new homes sales data will cross the wires.

Written by Viv Savani. 8:49am, January 3rd 2019

The details expressed in this market report are for information purposes only and are not intended as a solicitation for funds or a recommendation to trade. Cornhill International Payments limited accepts no liability whatsoever for any loss or damages suffered through any act or omission taken as a result of reading or interpreting any of the above information.

Previous Reports

8:31am, June 24th 2019

Volatile week expected with focus on G20 meeting…

View Report
9:01am, June 28th 2019

FX markets hold steady ahead of G20…

View Report
8:46am, July 1st 2019

US/China trade talks to restart…

View Report

Testimonials

Our Clients Say

"I have had an association with Cornhill for over a decade and have had the pleasure of working with the same broker for the entire period of time, which is currently just over 15 years. This shows not only my dedication and customer loyalty to the company, but also their commitment and successful staff retention. The level of service I have received has never waned or altered and has been consistent over the term. Keep up the good work Cornhill. Dominic you are a legend."

Helen - FD, Essex Boatyard

"When deciding to buy a property in France, my husband and I failed to consider the implications of the currency exchange and to be honest, it was extremely daunting to know that the cost of the property could have increased significantly potentially wiping out any renovations we had planned had we sat on our hands and left it to chance. Thankfully, Dominic (our account manager) and the rest of the Cornhill team couldn’t have been more helpful, and as such helped us to understand our options and secure a price that puts our bank to shame. Always courteous and friendly, we don’t know what we would have done without them now!"

Samantha Johnson - Private Client

"I work to very tight margins in my business and as such currency volatility has a major impact on how well my business performs. After dealing with my bank for many years, I took the step of opening an account with Cornhill after meeting one of their team at an industry event. James took the time to explain the services and quickly highlighted what I was missing from my bank – proactivity and competitive pricing. It’s almost impossible to get through to someone at my bank without jumping through many hoops. Cornhill are always in touch at the right time, which helps me to time my currency purchases and make the most of moves in my favour. I now rest easy knowing I have a team of people working FOR my business and adding true value to it both in pricing terms and proactivity terms. My profits have increased and I know I am in good hands!"

Martin Fisher – FD of a Packaging Business

"My products are made abroad by trusted suppliers who I have worked with for many years. After a number of issues with my previous currency provider (payments being delayed), I decided to look at who else could help with my payments. Fortunately, I was introduced to Cornhill by a former colleague who uses their services. Since then, I haven’t looked back. Customer service is often overlooked in this ever-increasing digital age, but to know I have someone to call at the end of the phone who will listen to my query and take ownership of it for me is a breath of fresh air. Vivek and Greg have been reassuring and whenever I have a question for them, they are quick to respond and resolve."

Alexandra Houghton – Founder of a clothing business