Forex Weekly Outlook – Is Euro Headed for Parity with The Dollar

Forex Weekly Analysis and Outlook – US Dollar, Euro, Japanese Yen, British Pound, Swiss Franc, Canadian Dollar, Australian Dollar, New Zealand Dollar, Turkish Lira, Mexican Peso. Risk aversion sentiment again dominated currency again this week. Rising U.S. interest rates and safe haven flows have seen the U.S. dollar soar in 2022. This week however the Greenback pulled back as traders priced in the odds of a U.S. recession becoming more likely. The Swiss franc was the beneficiary among the major … Continue reading “Forex Weekly Outlook – Is Euro Headed for Parity with The Dollar”

Forex Weekly Outlook – Currency Forwards and Option Hedging Strategies Rise with Soaring US Dollar

The US dollar has risen about 15% against a basket of currencies over the last year with rising U.S. interest rates and safe haven flows. The higher greenback has reduced the profits of U.S. multinational companies that convert foreign currency into dollars, multinationals such as Coca-Cola Co, Procter & Gamble and Philip Morris International are just some seeing an impact. The US dollar is at a two-decade high against the Japanese yen, up 13% this year. Against the Euro is … Continue reading “Forex Weekly Outlook – Currency Forwards and Option Hedging Strategies Rise with Soaring US Dollar”

Forex Weekly Outlook – Japanese Yen Weakest Major Currency Against US Dollar in 2022

Rising U.S. interest rates and safe haven flows have seen the U.S. dollar soar in 2022. The American 10-yr yield rose six basis points to 3.12%, hitting a fresh high for the year while the 2-yr yield fell five basis points to 2.67%. The US Dollar Index (DXY) hit a 20-year high, the highest levels since 2002. The weakest component of the index has been the Japanese yen, sliding around 12 per cent against the dollar and underperforming even weak … Continue reading “Forex Weekly Outlook – Japanese Yen Weakest Major Currency Against US Dollar in 2022”

Forex Weekly Outlook – US Dollar Hits 20 Year High in April on High Rates and Safe Haven Flows

The U.S. dollar has soared with safe haven flows as geopolitical fears grip the world and interest-rate increases from the Federal Reserve. US Dollar Index (DXY) hit a 20-year high, the highest levels since 2002. The Greenback reached multiyear highs against the euro, the British pound and the yen in April with the positive rate differentials, a huge part of the dollar’s strength. A strengthening dollar also tends to weigh heavily on emerging markets currencies, a rising dollar makes dollar-denominated … Continue reading “Forex Weekly Outlook – US Dollar Hits 20 Year High in April on High Rates and Safe Haven Flows”

China Consumer Inflation Hits 15 month High With a Jump in Food Prices

Inflation in China rose to 2.3% in November 2021, the highest figure since August 2020 from 1.5% a month earlier. Market consensus was 2.5%. Food prices and a further rise in cost of non-food items both rose. The cost of food increased for the first time in six months. China inflation November 2021 Consumer price index CPI 2.3% y/y, vs expected 2.5% y/y, prior 1.5% CPI 0.4% m/m, vs expected 0.4% y/y, prior 0.7% Highest since August 2020, boosted by … Continue reading “China Consumer Inflation Hits 15 month High With a Jump in Food Prices”

Reserve Bank Of New Zealand TWI Re-Weighting Sees Chinese Yuan Higher and Australian Dollar Lower

The RBNZ released it’s annual re-weighting of the Trade-Weighted Index (TWI) Thursday to take effect on Friday 10 December 2021. The Chinese yuan weighting rose from 0.2348 to 0.2704. Australian dollar weighting fell from 0.1871 to 0.1729. The TWI is a measure of the value of the New Zealand dollar relative to the currencies of New Zealand’s major trading partners. There are 17 currencies included in the TWI and each currency is weighted using the country’s two-way goods and services … Continue reading “Reserve Bank Of New Zealand TWI Re-Weighting Sees Chinese Yuan Higher and Australian Dollar Lower”

Chinese Trade Surplus Surged to Record High USD84.54 billion in October

The Chinese trade surplus surged to a record high of USD 84.54 billion in October 2021 from USD 57.32 billion in the same month a year earlier. Exports rose by 27.1 % year-on-year to USD 300.22 billion;  extending double digit gains for the 13th month.

China First Quarter GDP Grows At Strongest Pace On Record At 18.3%

The Chinese economy rose 18.3% yoy in the first quarter, though lower than the market consensus of 19%. China’s growth accelerated from 6.5% growth in Q4 . This was the strongest pace of expansion since 1992 (when records were first published)

China Consumer and Producer Inflation Pace Quickens in March

Inflation in China came in higher than expected levels for both the consumer and producer in March. CPI 0.4% y/y (vs. expected 0.3%) & PPI 4.4% y/y ( vs. expected 3.6%) the quickest pace of increase since 2018.  China Inflation March 2021 Consumer price index CPI 0.4% y/y, vs expected 0.3% y/y, prior – 0.2% for the m/m at -0.5% This was the highest reading since October 2020. On a monthly basis, consumer prices fell by 0.5 percent in March, … Continue reading “China Consumer and Producer Inflation Pace Quickens in March”

People’s Bank of China Warn on Leverage of Chinese Households

The PBOC issued a research paper on the Chinese households credit situation highlighting that a household credit boom could tend to drag down economic growth more so than corporate debt.  Mortgages are handcuffing China’s economic potential, as funding is redirected toward real estate and away from more productive uses.