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Forex Weekly Outlook January 9-13

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U.S Dollar - Investors King
  • Forex Weekly Outlook January 9-13

The U.S dollar rebounded last week after job data showed the economy added just 156,000 jobs in December. Even though, this was lower than 175,000 jobs expected, wages rose 2.9 percent year-on-year. Signaling the labor market is reaching full employment.

However, with the unemployment rate rising 0.1 percent to 4.7 percent from 4.6 percent recorded in November, and wages reaching a 7-year high, experts believe worker shortages may become more frequent in 2017 and force businesses to raise wages even more in order to hire skilled workers.

This is expected to boost consumer spending and pressure costs, therefore, underscoring case for the Federal Reserve to raise rates at least 3 times in 2017.

While, in Canada, oil production cut continued to aid the economy and strengthen the position of the loonie. Bolstering trade balance to 26-month high in December, from a deficit of 1.0 billion. The unemployment rate ticked up to 6.9 percent from 6.8 percent, but a total of 53,700 jobs was created.

Although, the Bank of Canada Governor Stephen Poloz has stressed that there is still plenty of slack in the job market, a few experts have said that considering the fact that the U.S. is Canada’s biggest trading partner, that proposed Trump economic plan will boost job creation in Canada and further help revamp the economy after years of low oil prices.

In China, the People’s Bank of China raised the yuan exchange rate against the U.S dollar by 0.92 percent, making it the biggest one-day increase in more than 11 years. But the currency quickly slumped 0.5 percent after Goldman Sachs Group Inc. and other analysts called on clients to bet against the yuan, citing past scenarios, that the best time to bet against the yuan is after interventions that flushed out bearish positions and argued that intermittent intervention won’t work with Trump presidency, which is expected to cancel TTP deal, hence, they expect the yuan to trade above the 7.1 a dollar in 2017. This week, NZDCAD and EURCAD top my list

NZDCAD

In December, I mentioned the sell opportunity of this pair, since then it has dropped 339 pips to trade at 5-month low. This week, I will treat the evening star formed as the continuation of the bearish trend started in November.

Forex Weekly Outlook January 9-13

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Fundamentally, the Canadian economy is growing and will likely get better going forward, especially with the renewed economic growth in the US and oil production cut by the OPEC. This is projected to aid the Canadian dollar against the New Zealand dollar that currently depends on the struggling Chinese economic performance to function.

Therefore, I will be looking to sell NZDCAD for a 0.9084 target this week as long as 0.9298 resistance holds.

EURCAD

In early December, I mentioned the failure of the ECB’s quantitative easing program to boost inflation rate and help job creation in the manufacturing sector due to weak oversea orders. Since then, this pair has gained 539 pips before retracing below 1.4070 resistance after OPEC successful consensus in December.

Forex Weekly Outlook January 9-13

Click to enlarge

But with the Euro-area enmeshed in low inflation rate, weak manufacturing sector and uncertainty surrounding Brexit. I expect this pair to continue its bearish move following gravestone doji formed three weeks ago and a bearish candlestick that opened and closed below 1.4070 resistance.

So this week, I will be looking to sell this pair for 1.3742 targets as long as 1.4070 resistance holds.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Forex

Zimbabwe Mandates Partial Tax Payments in New Bullion-Backed Currency

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In a strategic move to reinforce its new bullion-backed currency, Zimbabwe will require businesses to pay a portion of their taxes in Zimbabwe Gold (ZiG), Finance Minister Mthuli Ncube announced on Wednesday.

The regulations, aimed at enhancing the stability and acceptance of the ZiG, are part of broader efforts to strengthen the nation’s fiscal and monetary framework.

“The Treasury is stepping up to complement the fiscal and monetary policy framework aimed at further anchoring the currency, exchange rate, and price stability,” Ncube stated in an emailed announcement.

Since 2020, Zimbabwe has allowed taxes to be settled in the currency businesses predominantly use. However, under the new system, specific ratios will dictate the portions of taxes that must be paid in ZiG and other foreign currencies, alongside those that can solely be settled in the new unit.

The ZiG, introduced on April 5, 2024, replaced the Zimbabwean dollar, which had depreciated by 80% against the US dollar in the official market earlier this year.

Backed by 2.5 tons of gold and $100 million in foreign currency reserves held by the central bank, the ZiG is part of Zimbabwe’s broader strategy to avoid the pitfalls that led to the collapse of its previous six currencies.

“The changes will add to a raft of measures aimed at ensuring the ZiG doesn’t suffer the fate of its predecessors,” Ncube stated.

The finance minister highlighted that the new tax policy is designed to foster greater stability in the ZiG’s value and ensure it becomes a cornerstone of Zimbabwe’s economy. The government hopes that by requiring businesses to transact in ZiG, it will boost demand for the currency, thereby strengthening its position in the market.

Additional measures to bolster the ZiG include urging miners to increase gold production and extending the currency crackdown to include more stringent regulations on companies. These efforts are geared toward ensuring a steady influx of gold to back the currency, thus reinforcing its value and credibility.

Economists have noted that the success of the ZiG will depend heavily on these regulatory measures and the government’s ability to maintain a stable economic environment. The ZiG’s introduction has already shown a “positive impact” on the economy, but sustained confidence in the currency will be crucial.

“Zimbabwe’s new tax policy is a bold step towards economic stability,” said John Mangudya, Governor of the Reserve Bank of Zimbabwe. “By ensuring that a portion of taxes are paid in ZiG, we are creating a consistent demand for the currency, which will help maintain its value and prevent the hyperinflation that plagued our previous currencies.”

The move has received a mixed reaction from the business community. While some see it as a necessary step towards stabilizing the economy, others are concerned about the immediate impact on cash flow and the complexities of adapting to the new system.

“We understand the government’s need to stabilize the currency,” said Takura Mugaga, CEO of the Zimbabwe National Chamber of Commerce. “However, we urge the authorities to consider the implementation challenges businesses might face and provide adequate support during the transition period.”

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Naira

Black Market Dollar to Naira Exchange Rate Today 18th June 2024

The black market, also known as the parallel market or Aboki fx, US dollar to Nigerian Naira exchange rate as of June 18th, 2024 stood at 1 USD to ₦1,480.

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New Naira notes

The black market, also known as the parallel market or Aboki fx, US dollar to Nigerian Naira exchange rate as of June 18th, 2024 stood at 1 USD to ₦1,480.

Recent data from Bureau De Change (BDC) reveals that buyers in the Lagos Parallel Market purchased a dollar for ₦1,510 and sold it at ₦1,500 on Monday, June 17th, 2024.

This indicates an improvement in the Naira exchange rate value when compared to today’s rate.

The black market rate plays a crucial role for investors and participants, offering a real-time reflection of currency dynamics outside official or regulated exchange channels.

Monitoring these rates provides insights into the immediate value of the Naira against the dollar, guiding decision-making processes for individuals and businesses alike.

It’s important to note that while the black market offers valuable insights, the Central Bank of Nigeria (CBN) does not officially recognize its existence.

The CBN advises individuals engaging in forex transactions to utilize official banking channels, emphasizing the importance of compliance with regulatory frameworks.

How much is dollar to naira today in the black market

For those navigating the currency exchange landscape, here are the latest figures for the black market exchange rate:

  • Buying Rate: ₦1,480
  • Selling Rate: ₦1,470

As economic conditions continue to evolve, staying informed about currency exchange rates empowers individuals to make informed financial decisions. While the black market provides immediate insights, adherence to regulatory guidelines ensures stability and transparency in forex transactions.

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Naira

Black Market Dollar to Naira Exchange Rate Today 17th June 2024

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on

New Naira notes

The black market, also known as the parallel market or Aboki fx, US dollar to Nigerian Naira exchange rate as of June 17th, 2024 stood at 1 USD to ₦1,510.

Recent data from Bureau De Change (BDC) reveals that buyers in the Lagos Parallel Market purchased a dollar for ₦1,490 and sold it at ₦1,480 on Thursday, June 13th, 2024.

This indicates a decline in the Naira exchange rate value when compared to today’s rate.

The black market rate plays a crucial role for investors and participants, offering a real-time reflection of currency dynamics outside official or regulated exchange channels.

Monitoring these rates provides insights into the immediate value of the Naira against the dollar, guiding decision-making processes for individuals and businesses alike.

It’s important to note that while the black market offers valuable insights, the Central Bank of Nigeria (CBN) does not officially recognize its existence.

The CBN advises individuals engaging in forex transactions to utilize official banking channels, emphasizing the importance of compliance with regulatory frameworks.

How much is dollar to naira today in the black market

For those navigating the currency exchange landscape, here are the latest figures for the black market exchange rate:

  • Buying Rate: ₦1,510
  • Selling Rate: ₦1,500

As economic conditions continue to evolve, staying informed about currency exchange rates empowers individuals to make informed financial decisions. While the black market provides immediate insights, adherence to regulatory guidelines ensures stability and transparency in forex transactions.

Continue Reading
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