A brief thank you to the three guest columnists who allowed me to at least try to take a holiday in August. But before any of them get ideas about settling into my seat on a more permanent basis, I’d just like to remind them, in the style of the late great James Brown, “I’m back, I’m back. Jonathan Butterfield? I’m the man. Andy Durrant? I’m the man. David Woo. David Who? I’m the man.”
Clearly, the FX market did not go on holiday in August. Cable suffered a 10% fall against the dollar, while the dollar index rose 5.46% in the month, its biggest increase since the 8.10% rise in October 1992. Talking around, although there now seems widespread agreement that sterling is doomed, there is not such a consensus that the dollar has turned. That is maybe why the moves accelerated, because not too many people were on them from the beginning.
Anyway, the dollar’s resurgence got me thinking, which as my editor will tell you, can be dangerous. Many years ago, I had to listen to a cable trader whinge about how much more money he had to make each year as a result of sterling strength.