• Following the inversion of the US yield curve on Friday, markets are now pricing a 90% chance that the Federal Reserve will cut rates by December of this year. Chicago Fed President Charles Evans spoke in Hong Kong this morning and stated that the Fed may have to ease rates if downside risks continue.
• Germany’s Ifo business sentiment opinion poll was published this morning, after weakness in the PMI version last week. The Ifo Institute’s March business climate index unpredictably rose, calming nerves after poor German manufacturing data.
• The Canadian dollar weakened against the greenback on as moves in the bond market and domestic retail sales data pointed to a slowdown in Canada’s economy. Domestic data showed that Canadian retail sales fell 0.3% in January marking the third consecutive decline.
• British Prime Minister May’s position could weaken substantially this week as members of Parliament are set to vote later today on whether to take control of the legislative agenda. This comes as the Prime Minister attempts to contain a rebellion within her cabinet. Market participants are taking a cautious approach to the pound, as GBPUSD continues to hold in the 1.30-1.33 range.
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To the Clients of EncoreFX:
It is with much regret that we inform you that EncoreFX’s (the “Company”) offices are suspending trading effective immediately.
This suspension will give the Company time to consider its restructuring alternatives. The restructuring has become necessary as a number of customers to whom the Company granted credit have defaulted on their obligations to the Company due mainly, we believe, to the rapid changes in the FX market caused by the coronavirus pandemic.
In order to provide stakeholders with transparency, the Company has filed an assignment in bankruptcy pursuant to Section 49(1) of the Bankruptcy and Insolvency Act (Canada) (the “BIA”) with respect to its Canadian operations and has assigned its Australian and New Zealand subsidiaries in Voluntary Administration in Australia and New Zealand.
Ernst & Young has been appointed as the licensed insolvency trustee (the “Trustee”) in Canada and as the Administrator in Australia.
Once the Trustee, working with the Company, has determined the best options for the Company and its stakeholders it will share that information with you. Information pertaining to the bankruptcy of EncoreFX will be available, in due course, on the Trustee’s website at: www.ey.com/ca/encorefx.