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French Election: Emmanuel Macron Claims Victory

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Emmanuel Macron
  • French Election: Emmanuel Macron Claims Victory

Marine Le Pen on Sunday conceded victory to centrist Emmanuel Macron in France’s Presidential elections.

Macron is set to beat the anti-euro candidate Le Pen by about 65 percent to 35 percent, according to the estimates of four separate pollsters — a bigger lead than predicted by surveys before the election — and one which removes the risk of France being led out of the currency bloc. Macron’s victory in the first round sparked a rally in the nation’s assets, with the euro gaining as much as 2 percent in its immediate aftermath.

With polls consistently giving a Macron lead of about 20 points, markets had largely priced in a victory for the centrist, meaning the scope for a relief rally may be more limited this time. Still, Le Pen’s defeat removes a cloud that has been hanging over the shared currency for most of 2017, and will strengthen its longer-term outlook, according to analysts. Thin liquidity in early Asian trading could also lead to exaggerated moves when currency markets open at 7 a.m. local time in New Zealand.

“The euro is likely to gap higher by less than a cent as traders in New Zealand run stop losses,” Sebastien Galy, a macro strategist at Deutsche Bank AG in New York, said in emailed comments. “In the weeks to come, inflows into euro zone equities should give the euro some support, but so will other factors.”

The shared currency closed at $1.0998 on Friday, up 2.5 percent since the first round of voting on April 23.

UniCredit SpA, which currently expects the shared currency to finish the year at $1.10, is likely to revise higher the forecast if the second round passes without any surprise, strategists including Vasileios Gkionakis said in a note to clients before the vote. Nomura Holdings Inc., and Bank of America Merrill Lynch both expect more gains for the euro, with the Japanese bank looking for a rebound to at least $1.15 in the next three to four months.

French Rally

The euro touched a six-month high of $1.10 last week, while French bonds and stocks have jumped since the first round of voting. The spread between French and German 10-year yields, seen as a key metric of investors’ concern before the vote, narrowed to the lowest since January on Friday, down from a four-year high in February.

French, Italian and Spanish stocks have been the big winners from the drop in perceived political risk since the first round. The CAC 40 has gained more than 7 percent, while the FTSE MIB is up almost 9 percent and the IBEX is up more than 7 percent. This compares with a gain of 2 percent for the S&P 500 and of 3 percent for the MSCI World index over the same period.

“It seems that political risks have subsided considerably already ahead of the vote,” Valentin Marinov, head of G-10 FX research at Credit Agricole, said on Friday. “This much could keep any gains fairly muted.”

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Naira

Naira Closed at N411.25 to US Dollar at NAFEX Window

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Naira Dollar Exchange Rate - Investors King

The Nigerian Naira declined further against the U.S Dollar on Tuesday ahead of the Ramadan holiday to trade at N411.25 to a single U.S Dollar at the Nigerian Autonomous Foreign Exchange (NAFEX) window.

The local currency plunged as low as N420.23 per dollar during the trading hours of Tuesday despite opening the day at N410.33/US$ before settling at N411.25 to a US dollar.

Investors on the window exchanged $98.33 million on Tuesday.

At the parallel section of the foreign exchange, Naira traded at N483 to a United States Dollar; N673 to a British Pound and N580 to a Euro.

Foreign exchange rates remained largely unchanged at the bureau de change section, with the Naira trading at N482 to a U.S Dollar; N674 to a British Pound and N584 to a Euro.

Several factors continue to weigh on the Nigerian Naira, especially with the foreign reserves hovering around record low and crude oil output not at an optimal level.

Other factors like rising inflation rate and drop in economic activity due to COVID-19 effect on the economy and lack of enough fiscal buffer to cushion the economy.

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Naira

Daily Naira Exchange Rates; Thursday, May 6, 2021

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Naira Exchange Rates - Investors King

Naira depreciated further at the parallel market on Thursday as the local currency traded at N485 to a United States Dollar. The Nigerian Naira exchanged at N676 to a British Pound and N585 to a Euro as shown below.

Naira Black Market Exchange Rates

Morning * Midday** Evening *** Final Rates

Date USD GBP EURO YUAN Canadian Australian
NGN BUY/SELL BUY/SELL BUY/SELL BUY/SELL BUY/SELL BUY/SELL
06/05/2021 480/485 665/676 575/585 62/69 395/405 292/320

Bureau De Change Naira Rates

Date

USD

GBP

EURO

NGN

BUY/SELL

BUY/SELL

BUY/SELL

06/05/2021

475/482

663/676

575/587

06/05/2021

475/482

663/676

575/587

Central Bank of Nigeria’s Official Naira Rates

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Forex

CBN Extends N5/$ Incentive Period to Boost Dollar Inflow

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Godwin Emefiele - Investors King

The Central Bank of Nigeria (CBN) has extended the N5 per US Dollar incentive on forex remittance indefinitely to boost liquidity and further deepen economic recovery.

The initiative was scheduled to end on May 8. It was introduced to encourage recipients of dollars to use formal banking channels and help the central bank capture such inflows to boost the stability of the local currency, which has been under pressure after oil prices plunged last year.

“We hereby announce the continuation of the scheme until further notice,” the regulator said in a statement on its website on Thursday.

The naira has been devalued three times since last year after a sharp drop in oil earnings, which accounts for 90% of foreign-exchange inflows, and remittances from workers abroad led to a dollar crunch in the West African nation, which produces the most crude in Africa. The local unit traded for 410.31 on the investors and exporters window, also called Nafex, as of 8:51 a.m. in Lagos.

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