Future Outlook: Global Currency Turmoil Post Christmas Holidays

  • Whatsapp
Global Currency Turmoil

LIPUTAN6 EN – The dollar strives to remain strong amid weak trading due to the Christmas holidays, facing pressure from indications that inflation in the world’s largest economy is declining, providing room for the US Federal Reserve to lower interest rates next year.

At the same time, the yen remains stable near the five-month high it recently reached, as the Bank of Japan is likely to soon end its extremely loose monetary policy.

Throughout most of 2022 and 2023, this policy has put pressure on the Japanese currency, while other major central banks have raised interest rates.

Currency movements remained significantly weak the day after Christmas, with continued closures in markets in the UK, Australia, New Zealand, Hong Kong, and others due to the holidays.

Against the dollar, the New Zealand dollar reached a five-month peak at 0.6325 dollars, while the Australian dollar remained close to its five-month high as well, recently reaching 0.6817 dollars in the latest trades.

The euro rose by 0.03 percent to 1.1024 dollars, staying close to the five-month high at 1.1040 dollars reached last week.

Sterling saw no significant change, trading at 1.2706 dollars.

Data released on Friday showed a decrease in prices in the United States in November compared to the previous month, for the first time in over three and a half years, and the annual increase in inflation fell by more than three percent, reinforcing market expectations for a Federal Reserve interest rate cut in March.

The dollar index fell near the five-month low reached last week, reaching 101.42, and reached 101.59 in the latest trades.

READ  Hezbollah's Retaliation Warning Rocks the Middle East: Controversy Surrounding the Assassination of Hamas Leader in Lebanon

In Asia, the yen rose by 0.1 percent to 142.25 per dollar, gaining additional support from comments by the governor of the Bank of Japan, Kozo Oida, indicating the possibility of a policy shift.

On the other hand, the Chinese yuan fell against the dollar, with expectations of more monetary easing measures from Beijing.

The yuan dropped in onshore trading by 0.1 percent to 7.1433 per dollar, while it recorded 7.1461 per dollar in the latest offshore trades.

This situation indicates that the financial markets are experiencing turbulence due to changes in the global economic conditions and monetary policies of major central banks. The dollar, as the world’s reserve currency, continues to be influenced by various factors, including economic news, monetary policies, and market sentiment.

The currency market experienced a quiet day after Christmas, with low liquidity due to the closure of some major markets. Nevertheless, some currencies like the New Zealand dollar and the Australian dollar remained active, reaching their highest levels in several months.

The Bank of Japan’s decision to end its extremely loose monetary policy has had a positive impact on the yen. Investors are cautious about potential changes in monetary policy, and this could affect the yen’s exchange rate in the coming period.

Furthermore, the depreciation of the yuan against the dollar reflects market expectations of further actions from the Chinese government to stimulate economic growth. Changes in the yuan’s exchange rate can also impact international trade and global economic relations.

Analysts note that the declining US inflation data may trigger further policy actions from the Federal Reserve. The decision to lower interest rates can have a significant impact not only on the dollar but also on other financial assets in the global market.

READ  Gaza Tragedy New, 19 Prisoners Killed, Including Tanzanian

In this situation, market participants should closely monitor news and economic events that may affect currency movements. Global economic uncertainty and monetary policy dynamics can create opportunities and risks for investors and traders.”

Please note that this analysis is general and situational, and market conditions can change rapidly. It is always advisable to conduct further research and consult with financial experts before making investment decisions.

Pos terkait

Tinggalkan Balasan

Alamat email Anda tidak akan dipublikasikan. Ruas yang wajib ditandai *