Forex

Dollar Builds Toward Six-week High Ahead of U.S. Jobs Data

Published

6 years ago

October 5, 2018

Dollar Builds Toward Six-week High Ahead of U.S. Jobs Data

The dollar edged toward a six-week high on Friday before monthly U.S. jobs data that investors hope will shed light on how much longer the Fed’s aggressive rate-hiking cycle will continue.

The greenback is outperforming other major currencies as the U.S. economy continues to grows strongly while recent data in other large economies, including the euro zone, has come in below expectations.

Investors are watching for signs of increasing U.S. inflation as companies including Amazon (AMZN.O) raise minimum wages. Friday’s non-farm payrolls release for September will give new indications of wage growth and labor market strength.

The dollar index .DXY, which measures its performance against a basket of six currencies, was 0.1 percent higher on the day at 95.804.

Private payrolls data came in stronger than forecast on Thursday, pushing the yield on the benchmark 10-year U.S. Treasury note US10YT=RR to its highest levels since May 2011.

“We have downplayed the relevance of the U.S. labor market report for the dollar … but the data might become more significant again now there is debate over how much longer the [Fed] rate hike cycle will continue,” said Antje Praefcke, a currency strategist at Commerzbank in Frankfurt.

The U.S. central bank foresees another interest rate hike in December, three more next year, and one increase in 2020.

Fed Chairman Jerome Powell on Wednesday talked up the U.S. economy, saying that the United States is on the verge of a “historically rare” era of ultra-low unemployment and tame prices.

That spooked investors and caused U.S. Treasury yields and the euro/dollar currency pair to breach key technical levels.

AUSSIE FALLS TO MULTI-YEAR LOW

The Australian dollar AUD=D4, often viewed as a barometer of risk appetite, slipped 0.3 percent to $0.7054, a 32-month low, as U.S. yield spreads continued to widen, pressuring stock markets and risk appetite around the world.

The Aussie, extending losses into a fourth straight session, has now fallen 2.1 percent this month.

The euro EUR=EBS edged down 0.1 percent to $1.1497 after brushing a six-week low of $1.1463 during Thursday’s session.

The dollar will continue to strengthen against the euro as well as the yen, with the common currency likely slipping back below the psychologically-significant $1.15 handle, said Yukio Ishizuki, senior currency strategist at Daiwa Securities.

The euro is down about 0.8 percent against the dollar this month.

Sterling rose to a 3-month high versus the euro on Friday after European Union Brexit negotiators said that a divorce deal with Britain was “very close”.

The pound rose to 88.14 pence EURGBP=D3, its highest since 9 July, on the report which cited two diplomatic sources.

Up Next

US Job Market Cools in September, Unemployment Improves to 3.7%

Don't Miss

NAFTA: US, Canada, Mexico Finally Agrees on Trade

Samed Olukoya

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.

Comments

Naira

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

The black market, also known as the parallel market or Aboki fx, US dollar to Nigerian Naira exchange rate as of May 13th, 2024 stood at 1 USD to ₦1,500.

Published

1 hour ago

May 13, 2024

Samed Olukoya

The black market, also known as the parallel market or Aboki fx, US dollar to Nigerian Naira exchange rate as of May 13th, 2024 stood at 1 USD to ₦1,500.

Recent data from Bureau De Change (BDC) reveals that buyers in the Lagos Parallel Market purchased a dollar for ₦1,470 and sold it at ₦1,460 on Friday, May 10th, 2024.

This indicates a decline in the Naira exchange rate compared to the current 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: ₦1,500
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.

Forex

Zimbabwe Implements Strict Rules: $14,782 Fine for Violating Official Exchange Rate

Published

3 days ago

May 10, 2024

Samed Olukoya

Zimbabwe, in a bid to stabilize its currency and clamp down on black-market trading, has introduced stringent regulations to penalize individuals and companies found violating the official exchange rate of its new currency, the ZiG.

Under the new rules announced by Finance Minister Mthuli Ncube, offenders will face a hefty fine of 200,000 ZiG or $14,782.

The move comes as the government seeks to enforce the sole use of the official exchange rate, which is determined daily by the Reserve Bank of Zimbabwe.

The decision to impose such a significant penalty underscores the seriousness with which Zimbabwean authorities are approaching the issue of currency stability.

By cracking down on those who flout the official exchange rate, the government aims to curb the proliferation of parallel markets and ensure the orderly functioning of the economy.

Previously, retailers were required to price their goods within 10% of the official exchange rate to prevent excessive profiteering.

However, this regulation has now been scrapped as it was deemed ineffective in curbing informal trading and maintaining the value of the currency.

The ZiG, introduced on April 5 as a successor to the Zimbabwean dollar, represents the country’s sixth attempt to establish a stable local currency.

Backed by 2.5 tons of gold and approximately $100 million in foreign currency reserves held by the central bank, the ZiG is intended to restore confidence in the nation’s monetary system.

Despite these efforts, the ZiG has faced challenges since its launch, including fluctuations in its value against major currencies.

Trading at 13.53 to the dollar as of Thursday, the currency experienced a record low of 13.67 to the dollar earlier in the week, highlighting the volatility inherent in Zimbabwe’s currency market.

The introduction of strict penalties for violating the official exchange rate reflects Zimbabwe’s determination to maintain control over its currency and stabilize its economy.

However, it remains to be seen how effective these measures will be in addressing the underlying issues contributing to currency instability and informal trading in the country.

Naira

Black Market Dollar to Naira Exchange Rate Today 9th May 2024

The black market, also known as the parallel market or Aboki fx, US dollar to Nigerian Naira exchange rate as of May 9th, 2024 stood at 1 USD to ₦1,450.

Published

4 days ago

May 9, 2024

Samed Olukoya

The black market, also known as the parallel market or Aboki fx, US dollar to Nigerian Naira exchange rate as of May 9th, 2024 stood at 1 USD to ₦1,450.

Recent data from Bureau De Change (BDC) reveals that buyers in the Lagos Parallel Market purchased a dollar for ₦1,440 and sold it at ₦1,430 on Wednesday, May 8th, 2024.

This indicates a decline in the Naira exchange rate compared to the current 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.