In contrast, the sterling was down against the euro, which edged 0.22% higher to 86.95 pence. Still, this wasn’t enough to push the British currency off track from rising 3% against the euro for the year. The pound’s rise against other major currencies this year is largely driven by the Bank of England’s tight fiscal policy in an effort to curb inflation.

Currently, investors are betting that the Bank of England (BoE) will take longer to lower interest rates than its counterparts at the US Federal Reserve and the European Central Bank (ECB). Traders expect the BoE to implement a combined 140 basis points of rate cuts in 2024; lower than an expected 160 basis points from the ECB and 150 from the Fed.

The post British Pound on Course for 5% Gain in 2023 appeared first on theprimarymarket.com.

“It’s a little bit of risk aversion, not a wholesale panic and not a huge amount of sell-off, but just a little bit of a move towards safety as markets wait to see how things develop,” Brad Bechtel, global head of FX explained, suggesting that investors are simply bracing themselves for further escalations.

Although the dollar index, which measures the greenback against a basket of six other major currencies, fell by 0.16%, the euro weakened against the resolute dollar by 0.19% to $1.0566.

Following the outbreak of conflict, the sterling rebounded from earlier losses to trade at $1.224 while the Japanese yen, which is another safe-haven currency, rose 0.57% higher to 148.47 per dollar.

The post Dollar Strengthens as Investors Seek Sake Haven as Middle East Conflict Breaks Out appeared first on theprimarymarket.com.

Such developments have strengthened bets that the Bank of England is set to implement a 25 basis point interest rate hike later this month. The central bank has implemented 14 straight rate hikes, bringing its key rate to 5.25%.

The pound declined by 0.5% against the US dollar to $1.2565; a slight rise from the $1.2529 realized earlier in the day. The latter figure is the pound’s weakest showing since June 13. The dollar index, which measures the greenback against six other currencies including the pound, rose 0.4% to 104.61.

The post Pound Slumps to 12-Week Low Amid Falling Business Activity appeared first on theprimarymarket.com.

Brazil’s real edged 0.2% against the U.S. dollar, while Chile’s peso declined 1.3% against the greenback, thereby backtracking from its first weekly gain in the last eight. Mexico’s peso is 0.2% lower ahead of its second-quarter GDP reading on Tuesday, while Peru’s sol fell by 0.2%.

Argentina’s peso rose to 728 per dollar after the South American nation received a new policy package from the International Monetary Fund. The new IMF package included payments of some $8 billion in August and December. Still, this cash influx would leave Argentina $7 billion short of its previous end-of-year 2023 target.

The post Latin American Currencies Slip Following Chinese Economic Boost appeared first on theprimarymarket.com.

Viewed largely as a safe haven during uncertain times, the dollar emerged stronger on Thursday against a basket of major currencies with the dollar index rising 0.15% to 103.50. The pound fell 0.3% to $1.2703 as a slowdown in British factory activity raised the possibility of a UK recession. European manufacturing also stumbled, sending the euro 0.07% lower to $1.0857.

“As the Jackson Hole Symposium gets underway, market participants are looking for direction,” Isabel Albarran, Investment Officer at Close Brothers Asset Management observed. Albarran observed that the cooling labor market, weak PMIs, and downward trending CPI could indicate that interest rate hikes may be nearing their peak.

The post Dollar Rises Ahead of Federal Reserve Chair Speech appeared first on theprimarymarket.com.

Measuring the dollar against a basket of major currencies, the U.S. dollar index fell by 0.14% to 103.18, still just shy of Friday’s 103.68, a peak since June 12. The benchmark 10-year U.S. Treasury yield hit 4.366%; its highest level since November 2007.

“Surging long-term U.S. yields and the underwhelming response by China’s policymakers to ongoing stresses in China’s property and financial markets continue to provide bullish impulse,” Richard Franulovich, a currency strategist at Westpac, stated with regard to investors’ perceptions of the U.S. dollar.

The dollar fell 0.22% against the Japanese yen to 145.935. The sterling gained 0.16% against the dollar to $1.27765, while the euro rose 0.15% against the greenback to $1.0912.

The post Dollar Retreats Ahead of Fed Chair Speech appeared first on theprimarymarket.com.

Currently, the British central bank is expected to raise interest rates at its next policy meeting for the 14th time in this aggressive monetary tightening cycle. Even after inflation showed signs of slowing in June, a persistent rise in consumer prices has bolstered the need for the BoE to tighten its monetary policy further on Thursday.

On Monday, the pound stood steady against the dollar at $1.2856 with the euro being worth 85.85 pence. Unlike the BoE, both the U.S. Federal Reserve and the European Central Bank have confirmed their decisions to institute an interest rate pause during their September meetings.

“The market is priced aggressively for further rate hikes from the Bank of England and if that gets dialled down, this will weaken the pound,” Danske Bank’s Kundby-Nielsen observed before adding, “But significant further increases could hurt the economy even more. It’s a double-edged sword and I don’t really see a best-case scenario for the pound.”

The post British Pound Set for Monthly Gain in July appeared first on theprimarymarket.com.

The real advanced by 1.1%, thereby driving a 0.6% jump for the MSCI index for Latam currencies. This rise comes as the tax reform bill is set to be introduced to the Senate for further voting.

“The approval of a long-awaited tax reform bill by Brazil’s lower house of congress suggests that hopes for growth-friendly reforms during Lula’s term aren’t dead,” Kimberley Sperrfechter, emerging markets economist at Capital Economics, observed.

Part of President Luiz Inacio Lula da Silva’s plan to boost Brazil’s economic growth, the reforms are aimed at simplifying the nation’s complex consumption tax laws.

Despite its recent uptick, the real is still headed for a weekly loss of 1.6%; its largest downfall in the last 11 weeks.

The post Brazil’s Real Rises Following Tax Reform appeared first on theprimarymarket.com.

BoE’s Decision Maker Panel showed that output price inflation fell to 5.3% in the three months ending in June. Output price inflation was 5.4% for the three months ending May. June’s reading is the lowest since March 2022.

Given this cooldown, markets now expect the BoE’s interest rate to peak at 6.5% in February. BoE officials are still undecided on further rate hikes, monitoring economic data closely for guidance.

Andrew Bailey, Governor of the BoE, stated that the central bank must continue to adjust its monetary policy accordingly in order to attain its 2% target for UK inflation.

“Markets remain highly sensitive to any incoming developments on the price side and the still quite aggressive BoE tightening expectations,” Francesco Pesole, FX strategist at ING observed.

The post Sterling Rises as UK Companies Lower Price Inflation Expectations appeared first on theprimarymarket.com.

Despite its latest uptick, the yen continues to hover near its almost eight-month low of 145.07 per dollar. In an effort to prevent further depreciation, Japanese Finance Minister Shunichi Suzuki warned against excessive selling of the currency.

In comparison, the euro was down 0.15% against the greenback at $1.089, while the sterling climbed 0.18% against the dollar to $1.271. The U.S. dollar index, which tracks the greenback against six major world currencies, was little changed at 102.99.

Early on Tuesday, Japanese financial diplomat Masato Kanda revealed that officials had established close contact with U.S. Treasury Secretary Janet Yellen and other foreign authorities in an effort to remain on top of developments in currencies and the broader financial market.

The post Yen Strengthens as Investors Await News On Government Intervention appeared first on theprimarymarket.com.

In contrast, the sterling was down against the euro, which edged 0.22% higher to 86.95 pence. Still, this wasn’t enough to push the British currency off track from rising 3% against the euro for the year. The pound’s rise against other major currencies this year is largely driven by the Bank of England’s tight fiscal policy in an effort to curb inflation.

Currently, investors are betting that the Bank of England (BoE) will take longer to lower interest rates than its counterparts at the US Federal Reserve and the European Central Bank (ECB). Traders expect the BoE to implement a combined 140 basis points of rate cuts in 2024; lower than an expected 160 basis points from the ECB and 150 from the Fed.

The post British Pound on Course for 5% Gain in 2023 appeared first on theprimarymarket.com.

“It’s a little bit of risk aversion, not a wholesale panic and not a huge amount of sell-off, but just a little bit of a move towards safety as markets wait to see how things develop,” Brad Bechtel, global head of FX explained, suggesting that investors are simply bracing themselves for further escalations.

Although the dollar index, which measures the greenback against a basket of six other major currencies, fell by 0.16%, the euro weakened against the resolute dollar by 0.19% to $1.0566.

Following the outbreak of conflict, the sterling rebounded from earlier losses to trade at $1.224 while the Japanese yen, which is another safe-haven currency, rose 0.57% higher to 148.47 per dollar.

The post Dollar Strengthens as Investors Seek Sake Haven as Middle East Conflict Breaks Out appeared first on theprimarymarket.com.

Such developments have strengthened bets that the Bank of England is set to implement a 25 basis point interest rate hike later this month. The central bank has implemented 14 straight rate hikes, bringing its key rate to 5.25%.

The pound declined by 0.5% against the US dollar to $1.2565; a slight rise from the $1.2529 realized earlier in the day. The latter figure is the pound’s weakest showing since June 13. The dollar index, which measures the greenback against six other currencies including the pound, rose 0.4% to 104.61.

The post Pound Slumps to 12-Week Low Amid Falling Business Activity appeared first on theprimarymarket.com.

Brazil’s real edged 0.2% against the U.S. dollar, while Chile’s peso declined 1.3% against the greenback, thereby backtracking from its first weekly gain in the last eight. Mexico’s peso is 0.2% lower ahead of its second-quarter GDP reading on Tuesday, while Peru’s sol fell by 0.2%.

Argentina’s peso rose to 728 per dollar after the South American nation received a new policy package from the International Monetary Fund. The new IMF package included payments of some $8 billion in August and December. Still, this cash influx would leave Argentina $7 billion short of its previous end-of-year 2023 target.

The post Latin American Currencies Slip Following Chinese Economic Boost appeared first on theprimarymarket.com.

Viewed largely as a safe haven during uncertain times, the dollar emerged stronger on Thursday against a basket of major currencies with the dollar index rising 0.15% to 103.50. The pound fell 0.3% to $1.2703 as a slowdown in British factory activity raised the possibility of a UK recession. European manufacturing also stumbled, sending the euro 0.07% lower to $1.0857.

“As the Jackson Hole Symposium gets underway, market participants are looking for direction,” Isabel Albarran, Investment Officer at Close Brothers Asset Management observed. Albarran observed that the cooling labor market, weak PMIs, and downward trending CPI could indicate that interest rate hikes may be nearing their peak.

The post Dollar Rises Ahead of Federal Reserve Chair Speech appeared first on theprimarymarket.com.

Measuring the dollar against a basket of major currencies, the U.S. dollar index fell by 0.14% to 103.18, still just shy of Friday’s 103.68, a peak since June 12. The benchmark 10-year U.S. Treasury yield hit 4.366%; its highest level since November 2007.

“Surging long-term U.S. yields and the underwhelming response by China’s policymakers to ongoing stresses in China’s property and financial markets continue to provide bullish impulse,” Richard Franulovich, a currency strategist at Westpac, stated with regard to investors’ perceptions of the U.S. dollar.

The dollar fell 0.22% against the Japanese yen to 145.935. The sterling gained 0.16% against the dollar to $1.27765, while the euro rose 0.15% against the greenback to $1.0912.

The post Dollar Retreats Ahead of Fed Chair Speech appeared first on theprimarymarket.com.

Currently, the British central bank is expected to raise interest rates at its next policy meeting for the 14th time in this aggressive monetary tightening cycle. Even after inflation showed signs of slowing in June, a persistent rise in consumer prices has bolstered the need for the BoE to tighten its monetary policy further on Thursday.

On Monday, the pound stood steady against the dollar at $1.2856 with the euro being worth 85.85 pence. Unlike the BoE, both the U.S. Federal Reserve and the European Central Bank have confirmed their decisions to institute an interest rate pause during their September meetings.

“The market is priced aggressively for further rate hikes from the Bank of England and if that gets dialled down, this will weaken the pound,” Danske Bank’s Kundby-Nielsen observed before adding, “But significant further increases could hurt the economy even more. It’s a double-edged sword and I don’t really see a best-case scenario for the pound.”

The post British Pound Set for Monthly Gain in July appeared first on theprimarymarket.com.

The real advanced by 1.1%, thereby driving a 0.6% jump for the MSCI index for Latam currencies. This rise comes as the tax reform bill is set to be introduced to the Senate for further voting.

“The approval of a long-awaited tax reform bill by Brazil’s lower house of congress suggests that hopes for growth-friendly reforms during Lula’s term aren’t dead,” Kimberley Sperrfechter, emerging markets economist at Capital Economics, observed.

Part of President Luiz Inacio Lula da Silva’s plan to boost Brazil’s economic growth, the reforms are aimed at simplifying the nation’s complex consumption tax laws.

Despite its recent uptick, the real is still headed for a weekly loss of 1.6%; its largest downfall in the last 11 weeks.

The post Brazil’s Real Rises Following Tax Reform appeared first on theprimarymarket.com.

BoE’s Decision Maker Panel showed that output price inflation fell to 5.3% in the three months ending in June. Output price inflation was 5.4% for the three months ending May. June’s reading is the lowest since March 2022.

Given this cooldown, markets now expect the BoE’s interest rate to peak at 6.5% in February. BoE officials are still undecided on further rate hikes, monitoring economic data closely for guidance.

Andrew Bailey, Governor of the BoE, stated that the central bank must continue to adjust its monetary policy accordingly in order to attain its 2% target for UK inflation.

“Markets remain highly sensitive to any incoming developments on the price side and the still quite aggressive BoE tightening expectations,” Francesco Pesole, FX strategist at ING observed.

The post Sterling Rises as UK Companies Lower Price Inflation Expectations appeared first on theprimarymarket.com.

Despite its latest uptick, the yen continues to hover near its almost eight-month low of 145.07 per dollar. In an effort to prevent further depreciation, Japanese Finance Minister Shunichi Suzuki warned against excessive selling of the currency.

In comparison, the euro was down 0.15% against the greenback at $1.089, while the sterling climbed 0.18% against the dollar to $1.271. The U.S. dollar index, which tracks the greenback against six major world currencies, was little changed at 102.99.

Early on Tuesday, Japanese financial diplomat Masato Kanda revealed that officials had established close contact with U.S. Treasury Secretary Janet Yellen and other foreign authorities in an effort to remain on top of developments in currencies and the broader financial market.

The post Yen Strengthens as Investors Await News On Government Intervention appeared first on theprimarymarket.com.