May 25 2020 0
On the first day of the week, there has already been some intense news all over the world. Surely they will affect the market greatly. As traders, we must catch up with how the world is moving in order to choose the most suitable forex trading strategies.
The relationship between the world's two largest economies became worse and worse when Chinese Foreign Minister Wang Yi said the United States should abandon "vague thoughts" about changing China. and warn that the two countries are on the brink of a new "Cold War".
In a news conference on the sidelines of the Chinese People's Congress, held on Sunday in Beijing, he also criticized the United States for delaying nuclear talks with North Korea and warned that the US did not should challenge the "red line" of Taiwan. US-China relations have significantly deteriorated over the past few months with clashes over a range of issues from trade to human rights and Beijing's latest move to tighten the grip on Hong Kong.
Hong Kong protest
Protesters in Hong Kong confronted riot police in busy downtown areas on Sunday. This shows their fierce opposition to China's crackdown on dissent since the coronavirus swept through the city in January. Police have mobilized the use of both water cannons and tear gas guns into the Causeway Bay shopping area after hundreds of protesters gathered to protest the new national security laws from China. At least 180 people were arrested, mostly due to illegal gatherings, while at least 4 members of the local media police liaison team were injured.
Currency markets saw a quiet start at the beginning of Monday's session as traders watched more signals from economies reopening in the world amid tensions. growing between the United States and China. The Australian dollar and the overseas renminbi have depreciated, although the volume of transactions will become sparse on holidays in the US, UK and Singapore. Futures on the S&P 500 index futures were fairly quiet. All eyes will be on equities in Hong Kong after rising more than 5% on Friday. US stocks rallied on Friday as Asian stock futures advanced. WTI crude oil prices fell at the opening.
Search for flexibility
China Investment Corp (CIC) is seeking more flexible assets in markets hit by the coronavirus pandemic as the nation's $941 billion public wealth fund seeks to increase profits in the long run, according to Executive Vice President - Ms. Zhao Hai said. The Beijing-based company has added its investments to the credit market in recent months, especially investment-grade loans in the United States. CIC has also increased its holdings in healthcare and information technology as well as increasing its focus on Asian regions where there is less uncertainty about the spread of the virus. CIC considers a diversified portfolio to be the best way to pass the largest test since the foundation was established in 2007.
Japanese Prime Minister’s problem
Japan's coronavirus emergency may end soon after Monday, but Prime Minister Shinzo Abe's political troubles may be just beginning. Mr Abe's efforts to stem the outbreak and reduce economic damage have been ridiculed by many as "slow and ineffective". Now a biased scandal has pushed his approval rate to a level that has forced past prime ministers to resign. Moreover, the crisis weakened the support from his economic management and depleted the resources Abe needed to prevent a severe recession.