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Trade Fog! It’s All Going Haywire

This is a syndicated repost courtesy of Confounded Interest . To view original, click here. Reposted with permission.

This is an update on key economic news relating to US/China trade and UK/EU Brexit talks. Better known as Trade Fog … or simply “The Fog.” 

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On the Brexit side, the UK avoided recession by posting of 0.3% in August. Unfortunately, UK industrial production tanked to -1.8% YoY signaling a slowdown for the UK economy.

ukipyoy

On the China/US trade arm wrestling match, China’s offshore currency is showing volatility as even the NBA is getting caught up in the trade scuffle.

offshoreren

The volatility surface for the CNH is quite steep.

yuanvol

Of course, trade fog helps assets such as gold to rise.

gold101519

The volatility surface for gold is similar to that of the Chinese offshore currency.

goldvol

Trade fog (or trade vacillation) is on the rise as seen in this chart of V2X volatility.

vixvpl

The V2X index is above its various historic moving averages.

tradefog

As Brexit negotiation crawl along and the US meets with China or tariffs, we continue to see “The Fog” until Brexit and tariffs are finalized. Throw in Federal Reserve policy errors and we have a party!

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Wall Street Examiner Disclosure:Lee Adler, The Wall Street Examiner reposts third party content with the permission of the publisher. I curate posts here on the basis of whether they represent an interesting and logical point of view, that may or may not agree with my own views. Some of the content includes the original publisher's promotional messages. I may receive promotional consideration on a contingent basis, when paid subscriptions result. The opinions expressed in these reposts are not those of the Wall Street Examiner or Lee Adler, unless authored by me, under my byline. No endorsement of third party content is either expressed or implied by posting the content. Do your own due diligence when considering the offerings of information providers.

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