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Forex Weekly Outlook August 20 – 24

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British pound
  • Forex Weekly Outlook August 20 – 24

Global uncertainty and rising interest rates in developed economies are dictating the direction of the currency market. The slow down in China, rising risk in emerging economies, global trade tensions and weak wage growth are some of the key factors that will decide the foreign exchange rate of most nations going forward.

In the Uk, the pound has been falling since the Bank of England raised policy rate to 0.75 percent despite the projected increase in domestic demand, surged in consumer spending, 14-month record high expansion in the construction sector and moderate manufacturing growth. Indicating that growing uncertainty surrounding the Brexit negotiations is overshadowing the underlying fundamentals, therefore, hurting business sentiment and economic growth.

In Canada, surge in domestic inflation boosted the odds of the Bank of Canada raising interest rate as soon as September. The inflation rate rose to 3 percent year-on-year in July, up from 2.5 percent from the previous month and beats analysts’ projection of 2.5 percent. This was after the central bank raised interest rate for the fourth time within a year in July, validating the central bank’s assessment of the economy — “that the economy is operating close to capacity and further rate hikes will be needed”.

In Australia, the unemployment rate declined to 5.3 percent, while wage growth and inflation rate remained below expectation. This, the governor of the Reserve Bank of Australia said will hurt consumer spending in the near term, especially with the rising household debt. However, he expects wage growth to pick up gradually as the labour market gets tighter. The optimism he expressed during ‘Opening Statement to the House of Representatives Standing Committee on Economics’ bolstered Australian dollar outlook.

But growing uncertainty in emerging economies like Turkey, Venezuela (after the government devalued the currency by 95 percent) etc is disrupting the outlook of emerging currencies.

Therefore, because of the pound’s broad sell-off following the possible “no deal comments”. The focus will be on pound’s pairs this week.

GBPCAD

After the head and shoulders pattern, the GBPCAD dropped 663 pips to set a new record low at 1.6593 for the year. But with the renewed interest in the Canadian dollar due to the projected rise in interest rates in September and strong economic outlook, we might see a further surge in sellers’ interest on GBPCAD. Enough to push price towards 1.6339 support level in coming days. Therefore, as long as price remains below 1.7054 resistant level, I am bearish on this pair and will be looking to jump in below the 1.6661 support.

Forex Weekly Outlook August 20 - 24

GBPAUD

Similarly, the Australian dollar is a haven currency, therefore, enjoys rise in trade volume during a period of high uncertainty. Also, despite the weak consumer spending and sluggish wage growth, the surge in global commodity prices is supporting its economic growth. This week, I will be looking to sell the GBPAUD below the 1.7434 for 1.7274 support and expect a sustained break of that level to open up 1.7100 support level.

Forex Weekly Outlook August 20 - 24

EURCAD

While the Euro gained back part of its lost ground against the Canadian dollar on Monday, due to the drop in the value of commodity-dependent currencies following Venezuela devaluation, it is unclear if the new momentum can be sustained. This is because the currency crisis in Turkey and the uncertainty about the planned budget in Italy could weigh on the Euro, especially if the planned US-China trade talks scheduled for this week fails.

EURCADWeekly

Again, as long as price remains below the ascending channel as shown above, I will be looking to sell this pair for all the aforementioned reasons. The bearish trend started in March is likely to continue towards the 1.4799 support level now that the odds of the Bank of Canada raising rates in September is growing. However, I will be cautious because of the numerous events due this week.

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

Dollar to Naira Black Market Today, April 19th, 2024

As of April 19th, 2024, the exchange rate for the US dollar to the Nigerian Naira stands at 1 USD to 1,100 NGN in the black market, also referred to as the parallel market or Aboki fx.

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New Naira Notes

As of April 19th, 2024, the exchange rate for the US dollar to the Nigerian Naira stands at 1 USD to 1,100 NGN in the black market, also referred to as the parallel market or Aboki fx.

For those engaging in currency transactions in the Lagos Parallel Market (Black Market), buyers purchase a dollar for N1,020 and sell it at N1,010 on Thursday, April 18th, 2024 based on information from Bureau De Change (BDC).

Meaning, the Naira exchange rate declined slightly when compared to today’s rate below.

This black market rate signifies the value at which individuals can trade their dollars for Naira outside the official or regulated exchange channels.

Investors and participants closely monitor these parallel market rates for a more immediate reflection of currency dynamics.

How Much is Dollar to Naira Today in the Black Market?

Kindly be aware that the Central Bank of Nigeria (CBN) does not acknowledge the existence of the parallel market, commonly referred to as the black market.

The CBN has advised individuals seeking to participate in Forex transactions to utilize official banking channels.

Black Market Dollar to Naira Exchange Rate

  • Buying Rate: N1,100
  • Selling Rate: N1,090

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Naira

Naira’s Recent Gain Reflects Policy Direction, Says CBN Chief Olayemi Cardoso

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Naira Exchange Rates - Investors King

Olayemi Cardoso, Governor of the Central Bank of Nigeria (CBN), has explained that the recent surge in the Naira is a testament to the positive direction of government policies rather than active intervention to defend the currency’s value.

Addressing attendees at the spring meetings of the International Monetary Fund and World Bank in Washington, Governor Cardoso underscored that the CBN’s intention is not to artificially prop up the Naira.

He clarified that the fluctuations observed in the country’s foreign exchange reserves were not aimed at defending the currency but rather aligning with broader economic goals.

Over the past month, the Naira has experienced a notable uptick in value against the dollar, signaling a reversal from previous declines. Data from Bloomberg reveals a 6.4% decrease in liquid reserves since March 18, coinciding with the Naira’s rebound.

Despite this decline, Cardoso pointed out that around $600 million had flowed into the reserves in the past two days, reflecting confidence in the Nigerian market.

Governor Cardoso articulated the CBN’s vision of a market-driven exchange rate system, emphasizing the importance of allowing market forces to determine exchange rates through willing buyers and sellers.

He expressed optimism about a future where the central bank’s intervention in the foreign exchange market would be minimal, except in extraordinary circumstances.

The recent resilience of the Naira follows a period of volatility earlier in the year, marked by a substantial devaluation in January. Since then, the CBN has implemented measures to stabilize the currency, including monetary tightening and initiatives to enhance dollar liquidity.

Cardoso highlighted the transformation in market sentiment, noting that investors now perceive Nigeria’s central bank as committed to stabilizing inflation and fostering economic stability.

As Nigeria continues its journey toward economic recovery and stability, Cardoso’s remarks provide insight into the central bank’s strategy and its impact on the country’s currency dynamics.

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Naira

Dollar to Naira Black Market Today, April 18th, 2024

As of April 18th, 2024, the exchange rate for the US dollar to the Nigerian Naira stands at 1 USD to 1,020 NGN in the black market, also referred to as the parallel market or Aboki fx.

Published

on

New Naira Notes

As of April 18th, 2024, the exchange rate for the US dollar to the Nigerian Naira stands at 1 USD to 1,020 NGN in the black market, also referred to as the parallel market or Aboki fx.

For those engaging in currency transactions in the Lagos Parallel Market (Black Market), buyers purchase a dollar for N1,050 and sell it at N1,040 on Wednesday, April 17th, 2024 based on information from Bureau De Change (BDC).

Meaning, the Naira exchange rate improved when compared to today’s rate below.

This black market rate signifies the value at which individuals can trade their dollars for Naira outside the official or regulated exchange channels.

Investors and participants closely monitor these parallel market rates for a more immediate reflection of currency dynamics.

How Much is Dollar to Naira Today in the Black Market?

Kindly be aware that the Central Bank of Nigeria (CBN) does not acknowledge the existence of the parallel market, commonly referred to as the black market.

The CBN has advised individuals seeking to participate in Forex transactions to utilize official banking channels.

Black Market Dollar to Naira Exchange Rate

  • Buying Rate: N1,020
  • Selling Rate: N1,010

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