- Euro Climbs Along With Oil as Japan Stocks Decline
The euro spiked higher as the dollar weakened for a second day and oil advanced in thin end-of-year trading. Japanese stocks headed toward their first annual loss since 2011 while Hong Kong shares rallied.
The Bloomberg Dollar Spot Index shifted lower after reaching the highest level in more than a decade earlier this week. Oil was poised for its first annual advance in three years. The Nikkei 225 Stock Average’s gain for the year largely evaporated, while Hong Kong shares turned positive for 2016. The S&P 500 Index ended little changed Thursday following the announcement of new American sanctions against Russia over election hacks.
Trading has been thin across the globe during the last week of the year, with volumes in crude oil, equities and currencies all below average. Investors may be reallocating money as they assess asset moves in the wake of the U.S. election that took the dollar to multi-year highs, sent Treasuries tumbling and spurred a rally in American equities.
“Asian markets could see another day of mixed performances on the final trading day of the year with little inspiration for price direction,” said Jingyi Pan, a market strategist at IG Asia Pte. “The market is likely to be repositioning for the New Year with U.S. markets and that could place some pressure on markets that have underperformed lately.”
- The euro rallied as much as 1.6 percent before paring its advance to 0.4 percent and trading at $1.0527 as of 12:56 p.m. in Tokyo.
- The yen fell 0.1 percent to 116.70 per dollar, erasing an earlier advance of 0.4 percent. The currency was up more than 20 percent for the year in August, but has pared that to 3.2 percent.
- The Bloomberg Dollar Spot Index slipped 0.2 percent after dropping 0.5 percent Thursday, although it remains up 2.9 percent for the year.
- The MSCI Asia Pacific Index rose 0.1 percent, heading for a 2.3 percent advance for the year, its first annual gain since 2013. Pakistan was the region’s best market in 2016, jumping 45 percent, while China was set for the worst performance.
- Japan’s Topix fell 0.1 percent and is poised for a 2 percent decline in 2016. The Nikkei 225 index was down 0.2 percent Friday, almost wiping out a gain for the year.
- Australia’s S&P/ASX 200 Index dropped 0.6 percent, paring its annual gain to 7 percent, while New Zealand’s S&P/NZX 50 was off 0.2 percent. South Korea is closed for a holiday. The Kospi Index finished Thursday with a 3.3 percent advance for 2016.
- Hong Kong’s Hang Seng Index rose 0.9 percent, wiping out its losses for the year. The Shanghai Composite Index added 0.1 percent, paring its yearly decline to 12.5 percent. The Hang Seng China Enterprises Index jumped 1 percent, trimming its annual loss to 2.8 percent.
- The S&P 500 fell less than one point to 2,249.26 Thursday, the lowest close since Dec. 8. It is up 10 percent for the year. The Dow Jones Industrial Average slipped to 19,819.78, maintaining a 14 percent advance this year.
- The Stoxx Europe 600 Index lost 0.4 percent after closing Wednesday at the highest level in a year. The gauge is down 1.5 percent for 2016.
- Crude futures gained 0.1 percent to $53.83 a barrel, after Thursday’s 0.5 percent decline. Prices are up about 45 percent this year. Supply cuts from OPEC and other producing nations next month are intended to stabilize the market and reduce swelling global inventories.
- Gold rose for a fifth session Friday, adding 0.1 percent to $1,159.15 an ounce. The metal has rebounded 2.8 percent from an 11-month low, and is up more than 9 percent for the year.
- The yield on 10-year Treasury notes was little changed at 2.47 percent after dropping three basis points Thursday. It slid to 2.46 percent earlier in the week, the lowest since Dec. 14.
- The equivalent Australian yield was down one basis point at 2.77 percent, while the yield on similar New Zealand notes dropped five basis points to 3.33 percent.
Naira Exchange Rates; Monday, June 21, 2021
The Nigerian Naira continues its decline against global counterparts after gaining on the back of the Central Bank of Nigeria’s proposed increase in foreign exchange supply to all forex operators across the country.
Naira gained on the parallel market to exchange at N493 against the United States Dollar on Tuesday 15, June 2021 before dropping to N497 on Wednesday 16, June 2021.
The local currency plunged as low as N502 to a United States Dollar on the parallel market before the CBN announced its plans to up liquidity in an effort to ease scarcity and speed up business activities in the largely import-dependent economy. See the Naira exchange rates across various sections of foreign exchange markets.
Naira Black Market Exchange Rates
Morning * Midday** Evening *** Final Rates
Bureau De Change Naira Rates
Central Bank of Nigeria’s Official Naira Rates
|6/21/2021||SOUTH AFRICAN RAND||28.7174||28.7525||28.7876|
Travellers to Access $4k , Businessmen $5K as CBN Boosts Forex Supplies
Nigerians travelling abroad can access a maximum amount of $4,000 foreign exchange from the banks following the Central Bank of Nigeria’s announcement to increase forex supplies.
Sources from some of the banks said those travelling on business trips could also access a maximum amount of $5,000 for each trip.
The CBN had said in a recent statement that it had concluded plans to increase the amount of foreign exchange allocated to banks to meet legitimate needs.
This followed the warning by the CBN Governor, Mr Godwin Emefiele, to Deposit Money Banks to desist from denying customers the opportunity to purchase foreign exchange.
The purposes to access forex included Personal Travel Allowance, Basic Travel Allowance, tuition fees, and medical payments as well as Small and Medium Enterprises transactions or for the repatriation of Foreign Direct Investment proceeds, the CBN had stated.
At a virtual Bankers’ Committee meeting last week, the bankers discussed how the CBN intended to assist with forex to ensure availability for the upcoming summer period and the return of students to school in September.
The CBN also said the BDCs would continue to have their weekly allocations.
The committee observed that the rates were going up.
It stated, “The CBN has said that all the banks must make available at all times and anyone who wants to buy BTA, PTA, medical fees, student school fees and all the eligible invisible purchases to ensure that Nigerians are not forced to go and queue in the parallel market.
“So what the Central Bank is doing is to encourage all banks to make sure that there is available forex at all times, and that his information should be communicated on all our platforms.
“We are asking our customers to come to the branches and for BTA, for example, present the required documents, which are basically your international passport, your visa, your valid ticket and fill up the form in the bank.
“And what we have been instructed to do is ensure that we don’t turn anybody back and that we should request from the Central Bank once we exhaust the forex that we have.
“The idea is to have a hitch-free summer period and the resumption for children to go back to school. The idea is to ensure there is less pressure on the forex and then the rates will come down.”
Speaking during the virtual meeting, the Group Managing Director, Access Bank, Herbert Wigwe, said, “I think again as part of the central bank’s role in terms of price stability and the need to support small and medium enterprises, there was a highlight of the need for banks to go and support SMEs who import small raw materials for them to set up their businesses.”
The Managing Director, Ecobank, Patrick Akinwuntan, said, “All banks are available to ensure forex need is met.”
Managing Director, Sterling Bank, Abubakar Suleiman, said the CBN had provided sufficient foreign exchange to meet the needs of all legitimate Nigerian travellers and therefore, the idea of going to any other market should not arise at all.
U.S Dollar Gained as Fed Shifts Interest Rates Hike from 2024 to 2023, Crypto Drops
The United States Dollar gained on Thursday after the Federal Reserve raised inflation expectations to 3.4 percent and moved the year it is expected to raise interest rates from 2024 to 2023.
Policymakers suggested that interest rates could be raised twice by late 2023 given “Summary of Economic Projections” (SEP) released on Wednesday.
The dollar index, which tracks the greenback against six major currencies, gained 0.63 percent to 91.103, its highest since May 6.
The jump was as a result of renewed interest in the American economy as growth is expected to hit 7 percent in 2021 despite the rising inflation. Similarly, economic conditions are projected to improve faster than initially predicted.
The Federal Reserve Chair Jerome Powell said “the economic conditions in the committee’s forward guidance will be met somewhat sooner than previously expected.”
“The interesting thing is that the Fed has gone beyond simply acknowledging that inflation is rising and that the U.S. economy has a lot of momentum, and it has essentially shifted to a much more hawkish stance in this set of projections,” said Karl Schamotta, chief market strategist at Cambridge Global Payments in Toronto.
Powell said the central bank will maintain its $120 billion monthly bond-buying program to continue to support the economy but also suggested the possibility of pulling back on quantitative easing used to keep rates low.
“I think we’re back to talking about a mild rally in the U.S. dollar and the data becoming very important over the summer period prior to Jackson Hole and September’s meeting,” said Simon Harvey, senior FX market analyst at Monex Europe.
Billions Flow Out of Crypto Market Ahead of Better US Economy
Investors are moving money in billions out of the crypto market, according to Whale Alert reports. On Thursday, 26,999,9990 USDT valued at $26,999,990 was transferred from Binance to an unknown wallet while another 19,999,995 USDT transferred from Bitfinex to an unknown wallet.
Investors moved 20,000,000 USDT to Bitfinex; 55,180 Ether worth $134,030,121 from an unknown wallet to another unknown wallet and 55,000 Ether estimated at $133,389,506 was also transferred to an unknown wallet in the early hours of Thursday.
5,000 Ether worth $12,168,082 and 1,000 Bitcoins worth $38,953,357 were transferred from an unknown wallet to Binance. To see the rest of the money being moved out of crypto space visit Whale Alert.
Cryptocurrency market capitalisation dipped by 5.03 percent in the last 24 hours but has lost $898 billion from $2.523 trillion it attained on Wednesday, May 12, 2021, to $1.625 trillion on Thursday, June 17, 2021.
The plunge in cryptocurrency was a result of improving global economic outlook, especially in the United States of America, the largest crypto investing nation.
The unregulated crypto space is largely treated as a haven asset to avert disaster during the global downturn. Meaning, an improvement in the global economy will generally impact cryptocurrency capital inflow and overall performance. Investors King expects cryptocurrency to extend its decline in the third quarter.
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