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Property debt crisis in China, central bank bond policy and the energy crisis are combining for a volatile October - it is ever thus!
Fears Chinese mega developer Evergrande’s collapse will spark a contagion event and the ongoing European gas crisis has hit confidence.
The FX markets turns risk-off after less new jobs were added in the US last month than expected.
Volatility returned to the currency markets last week with the Australian and New Zealand Dollar falling the hardest against the Greenback (both down 1W -3.0%).
Speculation abounds on whether the RBNZ will be the first to hike rates, this helped the NZD to rise to 1 year highs versus the Aussie dollar.
Last week’s big event was the strong US Non-Farms Payrolls report for July.
The British Pound GBP was a mover and shaker last week, hitting HIGHS against both the USD (30-DAY), EUR (90-DAY) and other major FX.
The way out from the UK’s experiment of lifting most lockdown measures is far from certain.
Currency markets move when both the Reserve Bank of New Zealand and the Bank of Canada shift on their bond buying plans and interest rate outlooks.
The growth outlook for the Australian economic became pessimistic when more lockdowns were announced due to rising COVID-19 cases in Sydney.
US Non-Farm Payrolls report was a mixed result - the Unemployment Rate moved higher but Wages slipped.
Fed Officials mixed opinions following last week’s hawkish bent reduces markets perception of sooner rate rises.
Last week the US Federal Reserve moved its growth forecasts higher and brought forward the timing of its interest rate hikes to 2023.
Review of Currency Market trends and news from last week.
Friday was a volatile day in currency markets after a much weaker than expected US jobs report was released.
In May the US dollar has regained some of the ground it lost last month when it had its longest stretch without gains against a basket of peers in nine months.
New Year brings a weak US dollar and chaos in Washington DC with Capitol Hill reduced to a riot zone and President Trump impeached for a second time.
On Thursday Turkey’s central bank finally caved into financial markets and jacked up interest rates by a hefty 4.75 per cent raising the benchmark rate to 15 per cent promising to remain tough on inflation.
The recent period has been volatile for currency markets tossed about by US election uncertainty, stimulus spending doubts and both good and bad news from the COVID-19 frontline.
The Euro is slumping as France and Germany resume national lockdowns to combat surging second-wave Covid cases.
Currency rates were extremely volatile last week as the coronavirus situation worsened day by day with various countries implementing ever-tougher measures to stop the spread of the disease.
This week the US Dollar was touching three-year highs when valued against a basket of major currencies. The greenback's traditional role as one of the safe-haven currencies is helped by a domestic economy that is largely immune to the threats of the coronavirus.
The strong start to the year for "risk-on" currencies is already a distant memory.
The threat of a proxy war between the US and Iran in Iraq has pared back some of the recent gains of "risk-on" currencies.
Both the Australian dollar and British pound sterling have had a hard time of late caught between the rock of the China/US trade war and the Brexit hard place.
Enthusiasts would have us believe that Facebook’s own digital currency, Libra, will instantly revolutionize the remittance industry upon its release in 2020 — except it won’t. A harsher reality awaits, with conversion costs, capital gains taxes and a lack of Libra-priced goods all likely to limit its appeal.
The RBA has cut Australian interest rates to a record low of 1 percent in an effort to boost inflation. The Australian dollar is slightly stronger following the widely expected decision but is expected to lose 5–7 percent of its value before year-end.
Among the world’s ten most actively traded currencies, it was the Chinese yuan that was leading the pack approaching the end of the Asian business week. Last week: majors all down Aussie dollar (AUD) was down last week, retreating from US0.80 cents, on Australia’s disappointing rise in private sector wages, their massive contraction […]
Last week’s much-improved US inflation data had the desired effect on US rate expectations which have adjusted to indicate a 100% probability of the Federal Reserve raising interest rates in March. Ordinarily, such a revision to expectations would fuel a transfer of hot money into US dollars, yet dollar traders continue to chart their own […]
Hi there, during a week which saw global equity markets suffer their largest losses in two years and broader market volatility pick up, foreign exchange markets were surprisingly calm. A flight to safety benefitted the US dollar, which finished higher against a basket of currencies for the second consecutive week; and the Japanese yen, […]
Hi, Sterling was initially happy but has fallen against the Euro and US Dollar today following yesterday’s Autumn budget announcement, which has given UK economists plenty to talk about. UBS predicted the British Pound to fall closer to parity vs the Euro. The Euro has advanced against most of its peers in the last few […]
Hi there, ahead of some major announcements investors were in surprisingly good spirits yesterday, indicated by a stronger New Zealand dollar, South Korean won, rupee and a faltering yen. Sterling is subdued against the majority of its peers this morning as investors are reluctant to move ahead of the Bank of England (BoE) rate decision […]