28th March 2019 - USD turn to gain back ground

Walid Salah Eldin

Active member
190 1
The market sentiment is still possessed by increasing worries about the global economic growth outlook, after severe UST yields curves slide has been sparked last week by more than expected monetary dovish stance from the Fed.

Many pundits have seen in the yields curves slide an experienced turn signal to a recession to come, but the deployed $1.5 trillion since the beginning of last year on Trump's reflation plan should work against meeting a recession this year.

While the US labor market is still sending positive signs, the wages are growing up well sending the average earning per hour to its highest levels in a decade reaching 3.4% and the current trade talks between US and China can strike a deal to boost confidence in the investment spending again.



Many other Sovereign bonds yields have followed the UST this week to watch the Japanese 10yr bond yielding now -0.9% and also the Germane 10yr bund yield near -0.78% which is the lowest of it since 2016, after it has started this month near 0.183%, while UST 10yr yield is now close to 2.36%, after dipping to 2.3401% this morning.



EURUSD resumed its slide trading during the European session near 1.1225, after the turn came to EUR to fall following the Greenback which has been directly negatively impacted by the FOMC announced median forecast nearly a week earlier to have no interest rate hikes this year to drive this pair to 1.1447 following last week FOMC meeting.

The committee which was expecting by the beginning of this year raising the interest rate by 0.5% this year expected the growth to abate in this current quarter in US and the inflation to help it to keep adopting its current patience stance by running well below its 2% yearly target which has been announced in 2012.

On the current economic and financial developments to reach its macroeconomic objectives, The Committee also announced that it is to start next May a plan to halt the shrinking of the Fed’s balance sheet it started in October 2017.



The ECB had already taken its decision, before the Fed stating that will keep the rates at their present levels at least through the end of 2019 and in any case for as long as necessary, After it was expecting hiking through the summer of 2019.

The ECB announced a new series of TLTRO to be launched next September til March 2021.

The ECB downgraded 2019 growth forecast to 1.1% from the previous 1.7% and the inflation to 1.2% from 1.6% it expected last December.



While it is still all about Brexit in UK and GBPUSD is now trading close to 1.31, after PM Theresa May offered to step down, if her Brexit deal could secure a majority in Parliament opening the way for another conservative leader to take her place and finish the negotiations with EU.

May's announcement came to encourage who is not eager to see her in office to support her plan, after she had seen into the recent PMs rejecting votes no will to pass any amendments of her reached deal.



Amid series of votes on Brexit, May's cabinet lost 3 more ministers this week to have until now 29 ministerial resignations and all of them resigned on rejecting her plan or her way to deal with the crisis.

In the recent few days, The complicated situation inside the house of common started to clear out that there could be eventually "No Brexit deal or No Brexit at all, if there is new referendum to come".

So, Some Brexiteers inside the House started to show submission to May's deal, because they know that no May's deal approval means very high probability of conducting new referendum to be this time between "No Brexit deal or No Brexit".



UK has to pass May's deal before Apr. 12 to have Brexit delaying to May. 22, as what's required by EU which is still showing how it is difficult to leave it.



Kind Regards

Global Market Strategist of FX-Recommends

Walid Salah El Din
 

Rohit Fx

Newbie
3 0
The market sentiment is still possessed by increasing worries about the global economic growth outlook, after severe UST yields curves slide has been sparked last week by more than expected monetary dovish stance from the Fed.

Many pundits have seen in the yields curves slide an experienced turn signal to a recession to come, but the deployed $1.5 trillion since the beginning of last year on Trump's reflation plan should work against meeting a recession this year.

While the US labor market is still sending positive signs, the wages are growing up well sending the average earning per hour to its highest levels in a decade reaching 3.4% and the current trade talks between US and China can strike a deal to boost confidence in the investment spending again.



Many other Sovereign bonds yields have followed the UST this week to watch the Japanese 10yr bond yielding now -0.9% and also the Germane 10yr bund yield near -0.78% which is the lowest of it since 2016, after it has started this month near 0.183%, while UST 10yr yield is now close to 2.36%, after dipping to 2.3401% this morning.



EURUSD resumed its slide trading during the European session near 1.1225, after the turn came to EUR to fall following the Greenback which has been directly negatively impacted by the FOMC announced median forecast nearly a week earlier to have no interest rate hikes this year to drive this pair to 1.1447 following last week FOMC meeting.

The committee which was expecting by the beginning of this year raising the interest rate by 0.5% this year expected the growth to abate in this current quarter in US and the inflation to help it to keep adopting its current patience stance by running well below its 2% yearly target which has been announced in 2012.

On the current economic and financial developments to reach its macroeconomic objectives, The Committee also announced that it is to start next May a plan to halt the shrinking of the Fed’s balance sheet it started in October 2017.



The ECB had already taken its decision, before the Fed stating that will keep the rates at their present levels at least through the end of 2019 and in any case for as long as necessary, After it was expecting hiking through the summer of 2019.

The ECB announced a new series of TLTRO to be launched next September til March 2021.

The ECB downgraded 2019 growth forecast to 1.1% from the previous 1.7% and the inflation to 1.2% from 1.6% it expected last December.



While it is still all about Brexit in UK and GBPUSD is now trading close to 1.31, after PM Theresa May offered to step down, if her Brexit deal could secure a majority in Parliament opening the way for another conservative leader to take her place and finish the negotiations with EU.

May's announcement came to encourage who is not eager to see her in office to support her plan, after she had seen into the recent PMs rejecting votes no will to pass any amendments of her reached deal.



Amid series of votes on Brexit, May's cabinet lost 3 more ministers this week to have until now 29 ministerial resignations and all of them resigned on rejecting her plan or her way to deal with the crisis.

In the recent few days, The complicated situation inside the house of common started to clear out that there could be eventually "No Brexit deal or No Brexit at all, if there is new referendum to come".

So, Some Brexiteers inside the House started to show submission to May's deal, because they know that no May's deal approval means very high probability of conducting new referendum to be this time between "No Brexit deal or No Brexit".



UK has to pass May's deal before Apr. 12 to have Brexit delaying to May. 22, as what's required by EU which is still showing how it is difficult to leave it.



Kind Regards

Global Market Strategist of FX-Recommends

Walid Salah El Din
Thanks
 

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