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Forex Weekly Outlook May 15-19

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Forex Weekly Outlook November 7-11
  • Forex Weekly Outlook May 15-19

The US economic data released last week showed the economy is growing at a steady pace ahead of the next Federal Reserve meeting in June.

However, there were noticeable weaknesses in the figures. For instance, while the Producer Price Index rose 0.5 percent in April, the inflation rate rose less than projected –up 0.2 percent from plunging 0.3 percent in March.  Suggesting, perhaps the inflation is not rising as previously anticipated by policy-makers.

Similarly, retail sales climbed 0.4 percent in April. Also, below the 0.6 percent expected by experts but more than the 0.1 percent increase recorded in March.

This shows that while consumers are optimistic as shown by the University of Michigan consumer sentiment (97.7), inflation is hardly breaking out and wage remains soft. Therefore, it is unlikely that the Federal Open Market Committee (FOMC) will feel pressure enough to raise rates in June as that would impact wage and hurt consumer spending substantially.

In the U.K, factory production plunged further by 0.6 percent in March after declining 0.3 percent in February. Indicating that rising inflation has started affecting the manufacturing sector.

Also, the Monetary Policy Committee members voted to keep asset purchase at 435 billion with the official bank rate at 0.25 percent ahead of June 8 election.

Overall, the US economy remains resilient ahead of FOMC meeting in June, however, few inconsistencies may hamper June rate hike and possibly put a temporary stop to the current dollar rally as the market looks to the U.K. for clues on the possible direction of the Brexit.

This week, USDJPY and EURGBP top my list.

USDJPY

Last week this pair gave us 156 pips but was 8 pips short of our target 114.43. While I am not convinced that USDJPY would break 114.43 resistance, given current economic data, there is a probability of price hovering between 112-114 price level before a possible break below the descending channel. A sustained break below 112.47 support levels should increase sell orders and pressure price below 111.81 support levels.

USDJPYDaily

Therefore, this week I will be looking to sell this pair as the market looks to decipher FOMC stance ahead of June rate decision. An optimistic outlook would boost this pair rally and vice versa.

EURGBP

This pair closed as a dragonfly doji on weekly candlestick after data showed the U.K. factory output plunged for second consecutive month.

While this pair has failed to honor the head and shoulders formation shown in the chart, it should also be noted that price has remained above the neckline for the past 5 weeks and closed above 0.8471 resistance level for the first time last week.

Forex Weekly Outlook May 15-19

Again, with inflation rate rising and manufacturing sector slowing down, consumer spending that contributes about 70 percent of the economy would likely start reflecting those weaknesses. Therefore, this week I will be looking to buy this pair above 0.8471 support level with my target 1 at 0.8557 resistance, the 20-day moving average. A sustained break should attract enough buyers to open up 0.8717 resistance.

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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Naira

Black Market Dollar to Naira Exchange Rate Today 13th June 2024

The black market, also known as the parallel market or Aboki fx, US dollar to Nigerian Naira exchange rate as of June 13th, 2024 stood at 1 USD to ₦1,490.

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NAIRA - Investors King

The black market, also known as the parallel market or Aboki fx, US dollar to Nigerian Naira exchange rate as of June 13th, 2024 stood at 1 USD to ₦1,490.

Recent data from Bureau De Change (BDC) reveals that buyers in the Lagos Parallel Market purchased a dollar for ₦1,480 and sold it at ₦1,470 on Wednesday, June 12th, 2024.

This indicates a slight 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: ₦1,490
  • Selling Rate: ₦1,480

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 12th June 2024

The black market, also known as the parallel market or Aboki fx, US dollar to Nigerian Naira exchange rate as of June 12th, 2024 stood at 1 USD to ₦1,480.

Published

on

Naira to Dollar Exchange- Investors King Rate - Investors King

The black market, also known as the parallel market or Aboki fx, US dollar to Nigerian Naira exchange rate as of June 12th, 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 ₦1,500 and sold it at ₦1,490 on Thursday, June 6th, 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.

Continue Reading

Forex

Cedi Falls to Record Low Due to Increased Dollar Demand from Importers

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inflation

The Ghanaian cedi has plummeted to a record low of 14.9335 per dollar as the increase in demand for US dollars by companies importing fuel, pharmaceuticals, and other fast-moving consumer goods put pressure on the currency.

This depreciation, observed by the close of trading in Accra, marks the cedi’s lowest level since at least 1994 when Bloomberg began tracking the data.

Since the start of the year, the cedi has declined by 20% against the US dollar, ranking it as the fourth-worst performing currency among approximately 150 tracked globally by Bloomberg, following the Egyptian pound, Nigerian naira, and Lebanese pound.

“Dollar demand from oil importers, the pharmaceuticals industry, and FMCG companies remains strong,” noted Samantha Singh-Jami, Africa Strategist at Rand Merchant Bank. “Although authorities have significantly increased foreign exchange reserves in recent months, there are still constraints on foreign exchange liquidity in the market.”

Ghana’s gross international reserves rose to $6.6 billion in April, the highest in over 19 months, as per data compiled by Bloomberg.

The central bank has been strategically managing these reserves to ensure sufficient market supply, including directly addressing some companies’ foreign exchange needs to alleviate the pressure on commercial banks.

This increase in reserves follows Ghana’s decision to halt servicing most of its external debt since December 2022.

The move was part of a debt restructuring effort to qualify for an International Monetary Fund (IMF) program. Disbursements from the $3 billion IMF package and inflows from other multilateral and bilateral sources have bolstered the reserves.

However, the cedi’s decline is also attributed to a significant drop in cocoa export revenue, which has diminished foreign exchange supply. Revenue from cocoa shipments fell by 49% to $599 million from January through April.

The country’s cocoa output for the 2023-24 season is projected to be between 422,500 and 425,000 tons, which is only half of the initial estimate.

“The weakening of the cedi seems to reflect foreign exchange flow mismatches,” said Samir Gadio, head of Africa Strategy at Standard Chartered Bank. “Foreign exchange demand recovered this year, though it has remained broadly constant in recent months, and continues to exceed supply.”

The combination of high demand for dollars by importers and reduced foreign exchange inflows has created a challenging environment for the cedi.

Despite efforts by the central bank to manage the situation, the currency continues to struggle under the weight of these economic pressures.

Economic Outlook

The Ghanaian government and central bank face a tough task in stabilizing the cedi amidst these challenges.

Ensuring adequate foreign exchange liquidity while addressing the structural issues in the economy, such as reliance on imports and fluctuating export revenues, will be crucial in reversing the cedi’s downward trend.

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