Dec 09 2019 1
Here are some news of the day that a forex trader must know to apply the right forex trading strategies.
The protest flags keep waving
Last Sunday, Hong Kong saw the biggest pro-democracy rally in months, signaling the unrest will appear in 2020 when the movement still shows its strength. Hundreds of thousands of protesters swept into major downtown boulevards, many waving American flags, singing "Glory to Hong Kong" and chanting "Five key demands, not one less". Some protesters also called for interrupting travel on Monday morning. This is the first demonstration organized by the Civil Rights Front for police approval since August. A violent performance has followed the landslide victory of democratic forces in Local elections last month. We predict this will continue to affect the Hong Kong market greatly. So, consider your new forex trading strategies for the next few weeks.
The downfall of exporting
The sudden drop in exports in China in November showed a single reason why Beijing wanted to agree on a "phase 1" trade deal - because US tariffs are hurting Chinese exports. Korea when global demand has weakened. On Sunday, Chinese customs authorities said total exports in November were down 1.1% from the previous year, while exports to the US were down 23% - a continuous decrease in the 12th month. Total shipments were expected to increase by 0.8% as retailers and companies all stockpiled for Christmas. About 18 months of tit-for-tat, taxes destroyed both economies, Chinese companies and American farmers sold less to the other. Even if some tariffs are removed, the economies of both sides will be worse than before if there were no conflicts.
A rise in the market
Asian stocks are poised to kick off a new week with gains after US stocks gained on Friday on better-than-expected employment data. The currency market was stable at the beginning of Monday. The futures market in Japan, Australia and Hong Kong all increased. Profits can be controlled when the December 15 tariff date between the US-China has yet to come and after Chinese exports dropped unexpectedly in November.
On Friday, the S&P 500 rose. for the third day in a row after the report showed that payrolls have risen the most since January, surpassing both estimates and stabilizing consumer sentiment. Treasury Bond yields increased over 1.80%. Elsewhere, oil prices rose after Saudi Arabia surprised the market by promising significant production cuts beyond what was agreed with OPEC + members. Find a broker and seize your chance now.
At risk of failure
The era of shocks and fears of central banks is over. More than 10 years of fighting the crisis - including the rush to support global growth this year - policy makers in key economies have faced a new decade with the same. few options to cope with the next downturn. Interest rates have been around historic lows or negative levels after more than 750 cuts since 2008, raising concerns about adverse benefits.
At the same time, the fact that the leading central banks are buying bonds again (also known as quantitative easing) after buying more than 12 trillion dollars of financial assets is enough to revive inflation. As the Federal Reserve, European Central Bank and Japan Bank prepare to hold their final policy meetings of the year (as well as in the decade) in the next 2 weeks, it is worrying. The next 10 years could be their biggest test ever. Plan your forex trading strategies. Bank of America Corp analysts have warned investors to be wary of "quantitative failure or the inability of monetary policy".
Who caused the outburst of repo contracts?
According to a new analysis from the Bank for International Settlements, the boom in the repo market in September was driven by large banks and hedge funds. They also say that this turmoil indicates a structural problem in this important financial corner and that the incident is not just a temporary problem. This market, which relies heavily on four major US banks to fund, has been partly supported because these companies now hold more liquid assets in the Treasury than they hold at the Federal Reserve. That means "their ability to provide short-term funding in repo markets has been reduced", while hedge funds are funding more investments through repos. On September 17, the general interest rate for short-term collateral contracts rose from about 2% to 10%.