- Forex Trading And Economic Indicators: Toronto Attorney Guidance
- Dollar Falls To Two Week Low As Economic Data Softens
- Glen Point’s Phillips Says Us Trying To Criminalize Fx Trading
- U.s. Dollar Gains As Risk Tolerance Drops With Hawkish Central Banks
- Stocks Tumble After Weak U.s. Confidence Data; Oil Gains
Forex Trading And Economic Indicators: Toronto Attorney Guidance – [1/2]A woman holds US dollar bills in front of euro bills in this illustration taken on May 30, 2022. /Dado Ruvik/Illustration licensing rights secured
NEW YORK, April 3 () – The dollar stumbled on Monday after surrendering earlier gains following unexpected oil production cuts from OPEC+, as data showed the US economy continued to slow as manufacturing and construction spending declined.
Forex Trading And Economic Indicators: Toronto Attorney Guidance
Monday’s data added to the story that the Federal Reserve is nearing the end of its rate hike cycle.
Dollar Falls To Two Week Low As Economic Data Softens
An announcement on production target cuts by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, boosted oil prices on Sunday. Brent crude was last trading up 5.7% at $84.9 a barrel.
OPEC+ was expected to stick to the two million barrels per day (bpd) cuts already in place until the end of 2023, but instead announced production cuts of 1.16 million bpd.
OPEC’s impact, however, was short-lived as investors focused on monetary policy and disagreements between the Federal Reserve and other central banks, particularly the European Central Bank.
“Our working thesis is that we could see a peak in the U.S. dollar in the middle of the year,” said Shawn Osborne, chief FX strategist at Scotiabank in Toronto.
Glen Point’s Phillips Says Us Trying To Criminalize Fx Trading
“It’s predicated on the view that peak inflation means a peak Fed and a peak U.S. dollar. But it’s possible we’ll see that sooner than we expected.”
Monday’s economic reports for the March U.S. Manufacturing activity showed a near three-year low as new orders continued to shrink. The Institute for Supply Management (ISM) said its manufacturing PMI fell to 46.3 last month, the lowest level since May 2020, from 47.7 in February.
On Monday, federal funds futures indicated a 65% chance of another 25 basis points (bp) rate hike by the Fed in May. Futures traders also factored in a pause in June and rate cuts by December.
In the euro zone, traders are pricing in around 60 basis points for further tightening by the ECB by the end of the year after data released on Friday showed an acceleration in core price growth in the euro area.
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The euro was last up 0.6% at $1.0905 after hitting a one-week low of $1.0788 in the session.
“The Fed is done or close to done, we’re going to see a bit of tightening by the ECB. So we’ll see the euro/dollar hitting $1.10-$1.12 by the second half of the year,” Scotiabank’s Osborne said. .
The dollar index, which measures the currency against a basket of six currencies including the euro, was down 0.9% at 102.01.
While most markets are closed for the Easter holiday, this week’s focus is on Friday in the U.S. On jobs report.
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Against the Japanese currency, the dollar fell 0.3% to 132.44 yen, having earlier touched its highest level since mid-March.
Sterling was up 0.8% at $1.2422, while the dollar fell to 0.912 francs against the Swiss franc.
The risk-sensitive Australian dollar rose 1.5% to US$0.6790 ahead of Tuesday’s Reserve Bank of Australia policy meeting. Markets are 85% likely to keep the central bank rates steady after 10 hikes. The Aussie dollar had earlier hit a one-month high against the greenback.
In cryptocurrencies, Dogecoin, a meme coin backed by Tesla Inc ( TSLA.O ) founder Elon Musk, surged 27% to $0.10 on Monday after Twitter’s webpage used the token’s dog symbol instead of the social media website’s typical blue bird, market participants said.
U.s. Dollar Gains As Risk Tolerance Drops With Hawkish Central Banks
Reporting by Gertrude Chavez-Dreyfuss; Additional reporting by Samuel Indik in London and Ankur Banerjee in Singapore; Photo editing by Toby Chopra, Kirsten Donovan, Josie Cao and Richard Changfile: A Canadian dollar coin, commonly known as the “loonie,” is pictured in this illustration photo taken Jan. 23, 2015, in Toronto. /Mark Blinch/File Photo Acquire Licensing Rights
TORONTO, Sep 7 () – Analysts cut their bullish near-term forecasts for the Canadian dollar as China’s economy weakens and the gap between US and Canadian bond yields widens, but predicts the currency will be stronger in a year. .
The loonie is up 1.9% to 1.34 or 74.63 U.S. to the U.S. dollar in three months, according to the median estimate of about 40 foreign exchange analysts. Cents will strengthen, compared to last month’s estimate of 1.32.
It would advance to 1.29 on the year, matching the August forecast and yielding a 5.8% gain.
Stocks Tumble After Weak U.s. Confidence Data; Oil Gains
“The loonie has lost some feathers in recent weeks,” said Stéphane Marion, chief economist and strategist at the National Bank of Canada.
“Weaker commodity prices are keeping CAD under control as interest rate differentials widen with the U.S. and the Chinese economy slows.”
China’s economic growth is slowing as policymakers try to address a property market downturn. Canada is a major commodity producer, so the loonie is sensitive to the global growth outlook.
The currency has weakened nearly 4% since its July peak, but the Canadian 2-year yield has edged past its U.S. counterpart in recent weeks. fell further below par.
Dollar Skids After Soft U.s. Economic Data; Impact Of Opec+ Cuts Fades
On Wednesday, the U.S. The gap in favor of the note was 36.5 basis points, the largest since May 3, when the Bank of Canada left its key interest rate on hold at a 22-year high of 5%, saying it had entered the economy. A period of weak growth.
Canada’s economy unexpectedly shrank in the second quarter at an annualized rate of 0.2%, and growth was largely flat in July, data showed on Friday.
Canadian employment data for August, due on Friday, may provide further clues on the strength of domestic activity.
High borrowing costs are a major concern after Canadians borrowed heavily during the pandemic to participate in the red-hot housing market, and especially because of the short mortgage cycle.
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Almost all Canadian mortgages have a term of five years or less, compared to the typical 30-year term in the U.S.
“We believe market expectations will be surprised by any rate cuts by the Bank of Canada next year,” Marion said. In the ten largest Canadian cities, mortgage payments alone eat up nearly 59% of household incomes based on mortgage amortization. For over 25 years. That’s 70% of Canadian mortgages still paying fixed payments based on rates below 3%. With current mortgage rates around 6 percent, interest costs will double and become even higher under regulations.
Twenty-five percent of the mortgage book held by Canadian banks today is negatively amortized with amortization periods of over 25 years (ie, loan balances that grow monthly). Regulators have advised banks to bring these loans back to the traditional 25-year amortization, Stat.
In Toronto and Vancouver, mortgage payments on the median home consume a large portion of household income, according to economists at the National Bank of Canada. Look at how spread out home prices are in Canada, and even owners want them to drop.
Traders Need To Be More Picky In Betting Against The Dollar
Meanwhile, even with the massive bear market rally in the S&P 500 (SP500) from October to August, the index hit a new cycle high for 616 days (1.7 years); This price stagnation has only happened seven times in the last seven decades, and only in ongoing bear markets.
Total hours worked stagnated for six months and US nonfarm payrolls were revised lower for seven consecutive months — an extension pattern seen only during the last recession.
Portfolio manager, financial analyst, attorney, finance writer, regular guest in North American media. Danielle Park is the best-selling author of Myth Busting. Daniel has worked as an advocate for “Juggling Dynamite: Insider Knowledge on Money Management, Markets and Wealth,” as well as a popular daily financial blog: www.jugglingdynamite.com. Until 1997 she was assigned to work in an international security firm. A Chartered Financial Analyst (CFA), she is now with Venable Park Investment Counsel Inc. Co-founded www.venablepark.com as a portfolio manager and analyst at an independent investment advisory firm helping manage millions for some of Canada’s wealthiest families. For two decades, Daniel has been writing, speaking and educating industry professionals and investors on the risks and realities of investment behaviors. Member of internationally recognized CFA Institute, Toronto Society of Financial Analysts and Law Society of Upper Canada. Daniel is also an avid health and fitness buff.
If you have an ad-blocker enabled, you may be prevented from proceeding. Please turn off your ad-blocker and refresh. The Canadian reversed directions last week and scored 140 points. USD/CAD ended the week at 1.3318. Key events this week are CPI and Retail Sales. Here’s an outlook on major market movers and updated technical analysis for USD/CAD.
Interanational Trade And Finance
Last week’s headline was the Fed’s rate hike, raising rates to a range of 0.75%-1.00%. This led to widespread losses by the US dollar (here are 5 reasons why the dollar fell). Consumer inflation and retail sales were soft but in line with expectations. In Canada, manufacturing sales posted a 0.6% gain compared to a 2.3% gain a month ago.
USD/CAD opened the week at 1.3460 and reached a high of 1.3496 at resistance at 1.3457 (discussed last week). The pair reversed directions and fell to a
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