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Source: AP 2019
– In global markets, the appetite of market players for risky badets has declined after US Trade Representative Robert Lighthizer's statement that it may be difficult to conclude a trade deal between the United States and the United States. China.
At the same time, earlier this week, Donald Trump made positive comments. On Wednesday, US Federal Reserve Chairman Jerome Powell delivered a speech to the US Congress. He went to the Finance Committee of the House Finance Committee and, as expected, there is nothing new
In this regard, the ruble is trading close to 66 for a dollar. In addition to the above factors, the pressure on the ruble exerts a slight
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The Russian currency has been supported in recent days by a fiscal period. And not only. Exporters sell their currencies at a fair rate. According to a poll by Reuters, the latest income tax in February, paid on February 28, amounted to about 300 billion rubles, or $ 4.5 billion. The recent placement of ZOF by the Ministry of Finance of the Russian Federation also helped to support the ruble. The ministry sold 57.6 billion rubles of paper with a demand of 75.7 billion.
Since the beginning of the year, we have seen inflows into emerging markets via an Exchange Traded Fund (ETF). Including the latest auctions of the Ministry of Finance have been successful, which indicates the interest of foreign investors. But in general, this is not an indicator. Capital goes back and forth.
In case of deterioration of the external context, investors can quickly get out of their badets in rubles and access the dollar and the euro.
But it is too early to talk about it.
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In general, I expect increased volatility in March and a weakening of the national currency to 68 rubles to the dollar. In the spring, investors traditionally close speculative positions and opt for protection tools.
European indices of economic confidence continue to fall, the slowdown in the German economy could continue this year. The rate increase of the European Central Bank is expected to be postponed to 2020. The ECB meeting will be held on March 7 this year. We will examine the rhetoric of the European regulator. Nevertheless, I expect the Russian currency to weaken against the European currency at 77 rubles. This is also related to risk prevention.
What are the prospects for the pound sterling and the Canadian dollar?
If Brexit does not take placethe price of the pound against the US dollar (GBP / USD) could reach 1.40 during the year (around 1.32 now).
The Canadian dollar (CAD) is directly influenced by US financial policy and the dynamics of the US currency. Canada and the United States are neighbors. And the country is largely tied to the US economy. Any change has a direct impact on the Canadian currency, for example on import and export indicators.
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GDP, unemployment and inflation will only have a strong impact when the Bank of Canada interest rate begins to change. If the rate is stable, even a change of indicator will not have a significant impact.
Canada is the second largest country in the world for oil reserves. Oil prices are therefore of great importance for its currency. The United States is the largest importer of Canadian oil. After the last crisis, the United States started producing and exporting oil. The share of Canadian oil exports to the United States has therefore declined. And now CAD's dependence on oil exports has decreased, but the Canadian currency continues to correlate with oil.
The trade conflict between the United States and China is causing a drop in demand for oil and affecting its prices. All of this has a negative effect on CAD. Over the last five years, the dollar has appreciated against the Canadian dollar. If the Fed's monetary tightening continues and interest rates rise (the Bank of Canada will keep the rate unchanged), the dollar will continue to grow. And in this case, we can expect a USD / CAD pair at 1.57 (now 1.31).
See also: How to get out of the global crisis and not lose the last money in 2019
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