News

Recent Articles

23rd February 2015
Federal Open Market Committee Minutes

Slowly approaching into March the US rate increase expectations are melting along with the winter snow. The release of January FOMC Minutes has divided the audience with regards to the timing of the next rate hike, however the prevailing consensus is that this will happen later rather than sooner. In this report, we will look at the key takeaways from the January FOMC meeting Minutes and examine what are the implications for the rest of the economy.

 

“Several participants noted that a late departure could result in the stance of monetary policy becoming excessively accommodative, leading to undesirably high inflation…. Some participants were concerned that a decision to delay the commencement of tightening could be perceived as indicating that an overly accommodative policy is likely to prevail during the firming phase.”

 

Minutes of the Federal Open Market Committee (available here).

 

The dilemma “to raise or not to raise” is gaining on intensity...



more >
16th February 2015
Carney hints at rate rises despite expectations of deflation…

“The most likely next move in monetary policy is an increase in interest rates…”

Mark Carney, Bank of England Governor, February 12 2015

 

“Relative to the recent past, the economic outlook is much improved…while there is always uncertainty about the future, you can expect interest rates to begin to increase.”

Mark Carney, Bank of England Governor, September 25 2014

 

“There’s already great speculation about the exact timing of the first rate hike and this decision is becoming more balanced.  It could happen sooner than markets currently expect.”

Mark Carney, Bank of England Governor, June12, 2014

 

 

There is no question that Mark Carney has succeeded in completely confusing the financial markets about his intentions.  Before the UK inflation report was released last week, the expectations of an interest rate rise in 2015 were effectively zero (as measured by the UK interest rate futures market).  Immediately following the release of the UK inflation report last week, this probability...



more >
9th February 2015
US Employment Report: How strong is the bullish dollar case?

Over the past six months we have experienced one of the biggest US dollar rallies in recent history, where the USD reached highest level since the dot-com bubble on a trade-weighted basis. The outlook for 2015, with a diverging monetary policy between the US and the rest of the world, dictates that this one directional trend is likely to continue. Last week’s jobs data sent a strong signal to the financial markets that the US labour sector is recovering. Examining the employment report in detail, we reassess the strength of the bullish dollar case in 2015.

 

Chart I: USD Trade Weighted Index 

chart1

 

Employment report in detail…

 

 

 a) January non-farm payroll and upward Nov/Dec revision

 

The flashing headline for the non-farm payrolls at 257k in December strengthened the optimism about the US economy. The markets were expecting a drop from the previous 252k to 235k. In addition, the past numbers for November and December were revised...



more >
Older Entries >>>

 

White Papers


 

FX Hedging:

10 Common Pitfalls

Download> 

Commodity & FX Risk:

An Integrated Approach

Download> 

The Corporate Use of Credit Derivatives:

Where Next?

Download> 

Corporate Hedger’s Guide to Basel III

Download>

Currency Volatility – Are markets nearing an inflection point?

Download>

Testimonial

Private Equity

 

 “The Validus team understand how private equity thinks about financial risk management issues and they are rigorous in the way they help our portfolio companies to understand and mitigate their risks.”

 

James Markham, Partner – Portfolio Management, Graphite Capital LLP

Testimonial

FX and Commodity Risk

 

“Validus provides us with independent strategic advice relating to our long-term currency and commodity risk management program.  The people are extremely capable and collaborate very well with our finance and operations teams here at JD Irving.”

 

Mark Bettle, Director, J.D. Irving Ltd.

Testimonial

Commodity Risk

 

“Validus worked with us to develop a comprehensive commodity risk management programme – their analysis was both insightful and actionable.   We particularly value their independence, and they continue to work alongside our internal team to ensure our commodity price risks are managed effectively”


Gerry Gray, Finance Director, Strix Ltd.


Testimonial

FX, Commodity & Interest Rate Risk

 

“Validus comes up with risk management solutions that are innovative and comprehensive but practical to implement, that is their strength compared to other consulting companies we have worked with in the past.  Validus provided valuable insights into how FX, interest rate and commodity risks impact our organisation, and provide actionable recommendations and solutions.”

 

Andrew Ayres, Finance Director, U-POL Ltd.

Recent Comments