APAC Global Macro Morning Brief – Happy Macro Thu 5 Dec 2019: Time Decay & 86400... APAC Global Macro Morning Brief – Happy Macro Thu 5 Dec 2019: Time Decay & 86400... APAC Global Macro Morning Brief – Happy Macro Thu 5 Dec 2019: Time Decay & 86400...

APAC Global Macro Morning Brief – Happy Macro Thu 5 Dec 2019: Time Decay & 86400...

Macro 1 minute to read
Kay Van-Petersen

Global Macro Strategist

Summary:  Morning APAC Global Macro & Cross-Asset Snapshot

(Note that these are solely the views & opinions, they do not constitute any trade or investment advice of any kind.)

To see this wk’s Macro Monday click here

APAC Global Macro Morning Brief


Happy Macro Thu 5 Dec 2019: Time Decay & 86400...

So had a few folks pinging KVP saying great call on the risk-off from last Thu, etc… My response was firstly thanks, one should pick up any compliments than someone puts down in good stead – i.e. there is only going to be a finite amount of these for the majority of us, hover up what you can

Truth is, yes, even though we are c. 15 handle on VIX & now up c. 30% in last 5 trading days… we are not even -2% from the highs on the likes of the S&P

Think we need more of a -5% to -10% move to really warrant a correction & such a potential move is even questionable in regards to whether that fully prices the chance of a trade deal not happening. Whats the right pricing if a deal breaks?

Great question, something along the lines of VIX 15.00 getting over 25. UST 1.7672 getting sub 1.60%. Gold 1475, getting above 1525 – 1550. DollarYen 108.84 (great call by the way, when we flagged on Macro Monday that 109.50 lvls were looking tippy toppy) would get to sub 107 – 105. Nikkei would drop -5%, etc

Meanwhile we had a bounce o/n with SPX +0.63% to 3113, VIX -7.3% to c. 15 handle, USTs moved higher to c. 1.77. Gold & Silver were on the retreat at -0.20% & -1.85% to 1475 & 16.86…

So once again, market is still acting like phase one is as good as done… & you know what, the market may be right… THE MARKET TENDS TO BE RIGHT OVER TIME… & that is likely the best framework to start from…

Yet near-term KVP remains tactically skeptical. The skew is to the downside, the delta of that skew really once again lies in China’s court & of course counting down on the 10 days to  the Dec 15 US Tariff deadline on the trade deal…


Econ Review:

So overnight was Service PMI Wednesday & that’s what we got, interesting divergence…

  • China continues to show the bounce in PMIs as we saw Caixin Services at 53.5a 51.2e 51.1p


  • So basically we have gotten beats on both official & Caixin figures on both mfg. & serv. side. As wisely pointed out by our talented Peter Ganry, we’d take the data with a bucket or three of salt… as just not yet seeing that pick-up in China’s trade partners that would be associated with a sustainable bounce
  • One set of beats does not a bullish trend make, the Trixie part is… going into year end & the year start will have Chinese New Year… so there is going to be a lot of seasonal dispersion in China data for 4Q19 / 1Q20…


  • Euro-Zone saw a big beat on final services at 49.3a 48.6, with Spain shooting out the lights 53.2a 51.9e 52.7p. German also beat on services at 51.7a 51.3e
  • US was uncharacteristically the laggard o/n as we had ISM Non-mfg. coming in at 53.9a vs. an expected 54.5 & down from the previous 54.7 – again this warrants watching…Note that the final services PMI was in-line at 51.6 (flash had beaten 2wks back)


Overall KVP is seeing more & more headlines on global growth stabilizing, worst behind us, etc…

Again, think this comes down to how you slice up your time horizon… is this a mini-recovery in a long-term decelerating business cycle?


Or a big structural shift in higher sustainable growth globally?

Highly unlikely…


Bank of Canada unchanged rate decision & more importantly price action on a stronger loonie, played out exactly as we flagged in yesterday’s piece… Downright Outrageous…

USDCAD was c. 1.3300 Wed Asia morning, this Asia Thu morning we are c. 1.3187… that’s a +0.85% unlevered move in under 24hrs… Kudos to those with skin in the game

Would not over complicate any DollarLoonie shorts, trailing stop using recent highs as a starting point… we were c. 1.3270 right before the decision

Next BoC is Jan 22, with RBA Feb 4 & RBNZ Feb 12

Here is the link to the BoC statement

Fed & ECB are next Wed 11 & Thu 12



There are countless misplaced assumptions & frameworks that people operate with in the world. A lot of these stem from the bias of approaching things from an ethical sense of good or bad, or what feel right vs. wrong

Whilst the spirit in those approaches no doubt tend to be with the best intentions, it also tends to shut down any rational or logical thought. For instance not all humans beings are equal. Yes, they could all be deserving of equal rights & life… yet they are not all equal

Its an uncomfortable aspect, that we tend to look over in society…

There is one venue though where equality, is pretty much symmetrical when it comes to us as a species & that is time. More specifically how we use our time. There are 86400 seconds in the day

The delta between where you are today & where you want to be tomorrow, is simply determined by how poorly (first) & how well (second) you are using those 86400 second

A great analogy that KVP came across was the following. You life if like a bank account, that is credited with $86,400 everyday that needs to be spent, before the account is wiped clean & re-credited. So spend those dollars carefully

Because even though time & its use is about as great an equalizer as you can get, wealth actually creates more time  - both in magnitude & quality of that time…

Which if you think about it, is the epitome of leverage… i.e. You don’t just get more time, but the quality (use & lifestyle) of that time is also greatly enhanced? Sign me up…


Have an excellent day everyone, don’t forget super Friday in the US with NFP, AHE & U/R due tomorrow





  • NZ: RBNZ gov. Orr Speaking
  • AU: Retail Sales, Trade Balance
  • EZ: GER Factory Orders, Retail Sales, Revised GDP 1.2%e/p, Employment Change
  • US: Challenger Job Cuts, Trade Balance, Factory Orders
  • CA: Trade Balance, Ivey PMI 49.3e 48.2p 



Some Pieces From the Rest of the SaxoStrats Squad

Quarterly Outlook 2024 Q3

Sandcastle economics

01 / 05

  • Macro: Sandcastle economics

    Invest wisely in Q3 2024: Discover SaxoStrats' insights on navigating a stable yet fragile global economy.

    Read article
  • Bonds: What to do until inflation stabilises

    Discover strategies for managing bonds as US and European yields remain rangebound due to uncertain inflation and evolving monetary policies.

    Read article
  • Equities: Are we blowing bubbles again

    Explore key trends and opportunities in European equities and electrification theme as market dynamics echo 2021's rally.

    Read article
  • FX: Risk-on currencies to surge against havens

    Explore the outlook for USD, AUD, NZD, and EM carry trades as risk-on currencies are set to outperform in Q3 2024.

    Read article
  • Commodities: Energy and grains in focus as metals pause

    Energy and grains to shine as metals pause. Discover key trends and market drivers for commodities in Q3 2024.

    Read article

Saxo Capital Markets (Australia) Limited prepares and distributes information/research produced within the Saxo Bank Group for informational purposes only. In addition to the disclaimer below, if any general advice is provided, such advice does not take into account your individual objectives, financial situation or needs. You should consider the appropriateness of trading any financial instrument as trading can result in losses that exceed your initial investment. Please refer to our Analysis Disclaimer, and our Financial Services Guide and Product Disclosure Statement. All legal documentation and disclaimers can be found at https://www.home.saxo/en-au/legal/.

The Saxo Bank Group entities each provide execution-only service. Access and use of Saxo News & Research and any Saxo Bank Group website are subject to (i) the Terms of Use; (ii) the full Disclaimer; and (iii) the Risk Warning in addition (where relevant) to the terms governing the use of the website of a member of the Saxo Bank Group.

Saxo News & Research is provided for informational purposes, does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. No Saxo Bank Group entity shall be liable for any losses that you may sustain as a result of any investment decision made in reliance on information on Saxo News & Research.

To the extent that any content is construed as investment research, such content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication.

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments.Saxo Capital Markets does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment made in reliance of this presentation. Any opinions made are subject to change and may be personal to the author. These may not necessarily reflect the opinion of Saxo Capital Markets or its affiliates.

Please read our disclaimers:
- Full Disclaimer (https://www.home.saxo/en-au/legal/disclaimer/saxo-disclaimer)
- Analysis Disclaimer (https://www.home.saxo/en-au/legal/analysis-disclaimer/saxo-analysis-disclaimer)
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)

Saxo Capital Markets (Australia) Limited
Suite 1, Level 14, 9 Castlereagh St
Sydney NSW 2000

Contact Saxo

Select region


The Saxo trading platform has received numerous awards and recognition. For details of these awards and information on awards visit www.home.saxo/en-au/about-us/awards

Saxo Capital Markets (Australia) Limited ABN 32 110 128 286 AFSL 280372 (‘Saxo’ or ‘Saxo Capital Markets’) is a wholly owned subsidiary of Saxo Bank A/S, headquartered in Denmark. Please refer to our General Business Terms, Financial Services Guide, Product Disclosure Statement and Target Market Determination to consider whether acquiring or continuing to hold financial products is suitable for you, prior to opening an account and investing in a financial product.

Trading in financial instruments carries various risks, and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before trading. Saxo Capital Markets does not provide ‘personal’ financial product advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo Capital Markets does not take into account an individual’s needs, objectives or financial situation. The Target Market Determination should assist you in determining whether any of the products or services we offer are likely to be consistent with your objectives, financial situation and needs.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the US and other countries. AppStore is a service mark of Apple Inc.

The information or the products and services referred to on this website may be accessed worldwide, however is only intended for distribution to and use by recipients located in countries where such use does not constitute a violation of applicable legislation or regulations. Products and Services offered on this website is not intended for residents of the United States and Japan.

Please click here to view our full disclaimer.