Connect with us

Forex

Haven Gains Ebb as Traders Await Fed, ECB Minutes

Published

on

Japanese yen
  • Haven Gains Ebb as Traders Await Fed, ECB Minutes

A shift to haven assets in the wake of North Korea’s missile test faded as investor attention turned to central banks and the impending release of minutes of the latest Fed meeting. Oil fell, ending an eight-day winning streak.

Gold and the Japanese yen gave up early gains, with both the metal and the currency retreating. The dollar rose as U.S. stock futures and Treasuries traded sideways before the Federal Reserve release, due today. The euro was also little changed and European stocks edged higher amid a slew of services data, and as investors await Thursday’s publication of the latest ECB minutes. Oil dropped as Russia was said to oppose moves to deepen OPEC cuts.

An emergency United Nations Security Council meeting on Wednesday will try to formulate a response to North Korea’s latest provocation, but markets are once again showing the capacity to quickly move beyond periods of tension on the Korean peninsula. In the wake of last week’s unexpected turn toward tightening by a number of major policy makers, investors will scour the minutes for clues not only on the path for borrowing costs, but also for the fate of central bank balance sheets.

“The FOMC minutes will be the major macroeconomic highlight as the U.S. returns from the Independence Day break,” Ipek Ozkardeskaya, a market analyst at London Capital Group, wrote in a note. “Lack of details regarding the Fed’s balance sheet policy could further weigh on U.S. yields and the dollar.”

Beyond the Fed and ECB minutes, here’s what’s coming up:

  • A G-20 summit kicks off in Hamburg this week. U.S. President Donald Trump is expected to hold his first meeting with Russia’s Vladimir Putin as well as meet his Chinese counterpart Xi Jinping.
  • American employers probably added around 175,000 workers in June and wage growth probably strengthened, consistent with a solid labor market, economists project the U.S. Labor Department to report on Friday.

These are the main moves in markets:

Asia

  • Japanese and Hong Kong equities reversed early declines, ending higher as automakers and technology companies rose.
  • The yen fell 0.2 percent, after erasing a 0.4 percent advance.

Stocks

  • The Stoxx Europe 600 Index gained less than 0.1 percent after surging 1.1 percent on Monday.
  • Futures on the S&P 500 Index were little changed. The underlying gauge rose 0.2 percent Monday in a shortened session before the July 4 holiday.

Currencies

  • The Bloomberg Dollar Spot Index strengthened 0.2 percent.
  • The British pound was 0.2 percent weaker at $1.2898. The euro also slipped 0.2 percent to &1.1326.

Commodities

  • Gold dropped 0.1 percent to $1,222.35 an ounce, erasing an earlier gain of 0.5 percent.
  • WTI crude fell 1.6 percent to $46.31 a barrel. Oil has rallied more than 10 percent after falling into a bear market last month.

Bonds

  • The yield on 10-year Treasuries was little changed at 2.35 percent. The market was closed Tuesday.
  • U.K. benchmark yields advanced four basis points to 1.28 percent.
  • French and German yields were little changed.

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.

Continue Reading
Comments

Naira

Nigeria Hits Historic High as Currency in Circulation Surges to N3.69 Trillion

Published

on

naira

Nigeria’s currency in circulation surged to a historic high of N3.69 trillion, according to data released by the Central Bank of Nigeria (CBN).

This figure represents an increase of N43.07 billion or 1.18 percent from the total of N3.65 trillion reported in January 2024 and a 13.64 percent year-on-year rise from N3.25 trillion reported in February 2023.

Currency in circulation encompasses the physical cash, including paper notes and coins, actively used in transactions between consumers and businesses within the country.

The latest statistics indicate a considerable uptick in the availability of cash within the Nigerian economy.

The surge in currency supply comes amidst lingering concerns over a potential cash crunch following the monetary policy adjustments by the CBN, particularly the aggressive tightening stance of the Monetary Policy Committee (MPC).

Analysts attribute this spike to various factors, including the fear factor stemming from the cash crunch experienced in 2023 and lingering uncertainties surrounding the administration of physical currency.

Despite the surge in currency in circulation, Nigeria’s economic growth remains sluggish, with projections indicating growth rates of around 2.9 percent to 3.1 percent for 2024.

Also, inflation remains a significant concern, with the headline inflation rate climbing to 31.70 percent in February 2024 from 29.9 percent reported in January 2024, according to data from the National Bureau of Statistics (NBS).

The CBN’s proactive approach to monetary policy, including a historic increase in the monetary policy rate (MPR) to 24.75 percent, underscores the central bank’s commitment to addressing economic challenges and fostering stability amidst persistent pressures.

Continue Reading

Naira

Nigerian Naira Surges to N1,350 per Dollar in Parallel Market

Published

on

New Naira notes

The Nigerian Naira has appreciated to N1,350 per dollar in the parallel market, a significant gain from its previous rate of N1,430 per dollar just a day earlier.

Similarly, in the Nigerian Foreign Exchange Market (NAFEM), the naira strengthened to N1,382.95 per dollar, indicating an upward trend across key forex segments.

Data from FMDQ revealed that the indicative exchange rate for NAFEM fell to N1,382.95 per dollar from N1,408.04 per dollar on the previous day, representing a gain of N25.09 for the naira.

This surge in the naira’s value has widened the margin between the parallel market rate and NAFEM to N32.95 per dollar from N21.96 per dollar previously.

Analysts attribute this impressive surge to recent foreign exchange reforms implemented by the Central Bank of Nigeria (CBN).

These reforms, including the consolidation of exchange rate windows and liberalization of the FX market, have contributed to bolstering the naira’s strength against the dollar.

The CBN’s proactive measures aim to promote stability, transparency, and liquidity in the foreign exchange market, fostering confidence among investors and strengthening the national currency.

Continue Reading

Forex

CBN Governor Reveals $2.4 Billion Forex Forwards Under Investigation

Published

on

Naira Exchange Rates - Investors King

Governor Yemi Cardoso of the Central Bank of Nigeria (CBN) disclosed that law enforcement agencies are currently investigating foreign exchange forwards valued at $2.4 billion.

This announcement came in the wake of the Monetary Policy Committee (MPC) meeting held in Abuja on Tuesday, March 26.

Governor Cardoso shed light on the meticulous forensic audit conducted on these transactions, which uncovered numerous discrepancies, rendering them ineligible for payment.

The CBN, while settling certain tranches of FX backlog, encountered transactions riddled with issues concerning their authenticity.

To address these concerns, Deloitte management consultants were enlisted to conduct a comprehensive forensic analysis spanning several months.

The audit revealed a multitude of irregularities, including allocations disbursed without corresponding requests, lack of proper documentation, and instances of outright illegality.

Cardoso emphasized the gravity of the situation, stating, “We refused to validate them because, apart from the fact that documentation was not satisfactory in many cases, they were outright illegal.”

He underscored the commitment of law enforcement agencies to investigate these transactions thoroughly.

Despite concerns about potential backlogs among stakeholders, Cardoso assured that the market remains open and transparent for addressing any outstanding contractual obligations.

The CBN has diligently verified and settled recognized backlogs of forward transactions.

This revelation comes at a critical juncture as Nigeria grapples with economic challenges, including inflationary pressures.

The MPC’s decision to raise the benchmark interest rate to 24.75 percent reflects efforts to stabilize prices and restore the purchasing power of the average Nigerian.

As investigations unfold and regulatory scrutiny intensifies, the CBN’s commitment to transparency and financial integrity will be closely monitored by stakeholders across the nation.

Continue Reading
Advertisement




Advertisement
Advertisement
Advertisement

Trending