Economic and company news by ForexMart

Steinmeier is Germany’s Next President

The newly-elected president of Germany is Frank-Walter Steinmeier, he’s known to be the country’s foreign minister and now the 12th leader to serve the federal parliamentary republic. The 61-year old politician got 931 valid votes out of 1239 from the delegates of 16 different Germany’s states. There were 103 number of declines and 14 invalid votes.

Norbert Lammert, Bundestag president, proclaimed the final results which made the representatives respond a standing ovation excluding some members of the democratic party, Alternative for Germany (AfD). The AfD candidate got 42 votes only.

Leader of Christian Democratic Union and Chancellor, Angela Merkel said that she trust Steinmeier as he lead the nation during period of hardships and difficulties.

Moreover, Russian President Vladimir Putin sent his congratulatory message to Steinmeier via telegram and further ask to take a Moscow visit. Wh
 
February 16, 2017

BoE Proposed Revisions for Interbank Lending Benchmark Rate

The Bank of England re-evaluated its proposal to revise the lending rate benchmark for interbank exchange to prevent manipulation of reference point for financial contracts. Also, they intend to put on hold the changes between March and April next year, instead for this year.

In particular, they will change the procedure and apply the “trimmed mean” approach for calculating the Sterling Overnight Index Average (SONIA) which is used alternatively for some contracts with the global London Interbank Offered Rate (LIBOR). An estimated total of $450 trillion contracts were affected by the market scandal which BoE takes responsibility.
 
February 16, 2017

Kazakhstan Mulls Over $6.5 bln to Support Banks

Kazakhstan intends to provide 2.1 trillion-tenge ($6.5 billion) worth of government budget in strengthening the bank's condition covering the expenditures for the budget deficit and concerns about oil wealth fund. The Minister of Finance Bakhyt Sultanov presented this proposal to the Cabinet last Monday. Based on the report from Bloomberg, Timur Suleimenov the National Economy Minister mentioned that the administration intends to execute a major transfer for the national oil fund amounting to 1.5 trillion tenge ($4.6 billion) with a similar allocation to the deficit.

The biggest landlocked state considers backing the Kazkommertsbank which is the country’s largest asset lender. The private bank struggled due to severe debts upon the duplicated defaults within the BTA Bank in 2014. The same year when the crude prices stalled and further weighed to tenge, weakening the Kazakh economy. The central bank has amplified emergency loans approximately by 400 billion tenge last February 9 and half of the said amount were pinned to Kazkommertsbank.
 
February 16, 2017

USD Rallies after Hawkish Statements from Fed

The US dollar was able to reverse its losses and reach its highest value for this month as Fed Chair Janet Yellen’s comments came out to be very hawkish. The Fed chair stated yesterday that the timing is right for the central bank to implement another rate hike in the coming months, and that it would be impractical to hold off this particular event any longer. This increased the probability of a rate hike this March, and lent support for the USD’s value which has been gaining momentum during the past week.
 
February 20, 2017

Thai Economy Records Slowest Annual Growth as Consumption Wanes

Thailand’s economy recorded its slowest growth rate in over a year during the previous quarter as the country’s private consumption waned. Thailand’s GDP data showed an expansion by 3% during the past quarter, its slowest annual recorded move. Thailand’s economy surged by 3.2% in 2016 as compared to 2.5% two years ago. This slow GDP growth was mainly attributed to the death of the Thai king followed by a major crackdown on illegitimate Chinese tourists, which also caused the country’s private consumption to drop. However, the Thai baht was among the best-performing currencies in Asia after it grew by over 2% against the USD.
 
February 20, 2017

Greece Fears Economic Collapse amid Debt Crisis

Greek people have withdrawn money from their accounts which exceeds to £2billion as they fear the news regarding economic crash which will took place within 45 days. The Hellenic republic was alarmed about the possible scarcity of money in a period of five months because the country is affronted with repayments with an estimate of more than £5.1bn (€6bn), thus the country is unable to pay the total amount without any aid or restructuring.

Greece citizens were forbidden to take more than £1,540 (€1,800) every month from their accounts, however, the currency had continuously deplete at a very fast rate. There are speculations that the Government will fail to pay for the next settlement due in July.

Individuals which involves tourists were strained to wait in line in order to obtain cash from their respective banking machines.
 
February 20, 2017

Investors Attracted to Stable Returns of Emerging Markets

Emergings markets are attracting more investors to invest in infrastructures hoping for higher returns compelled by the rise in priced within the developed markets. This was based in the recent annual survey, around 41 percent of investors seek their interest in Asia-pacific, significantly higher than the 28 percent result last year. On the other hand, the demand for the Central and Eastern Europe climbed to 30 percent and 27 percent for Latin America from the previous 22 percent and 11 percent respectively.

Investments in toll roads, airports, and ports have gained interests from investors for steady returns and much more predictable cash flows with would be ideal for long-term liabilities. The demand for these assets is too high affecting the bidding. However, despite the low competition found in emerging markets, the currency risks had pushed the investors for investors to withdraw.
 
February 21, 2017


Brazil Eased Inflation Rate Less than 5 percent in February


Brazil lowered its inflation rate less than 5 percent halfway February for the first time since 2012. This was done to recuperate the economy after its two-year-long recession. The inflation target of Central bank comes in at 4.5 percent and they are open for further price easing. This would also be a big help for President Michel Temer who is seeking support in Congress.


On one side, the consumer prices slowed down quicker than expected which could force the authorities to ease their target for 2019. The reports will be publicized on Wednesday morning (1200 GMT) and at the same time, the central bank is anticipated to curtail its rates by 75 basis points from a two-year low of 12.25 percent.
 
February 21, 2017

U.S Gasoline Supply Piled Up

Crude oil prices stayed in the holding pattern as it awaits for a much clearer data regarding the possible consequences. OPEC have largely complied to support and keep prices away from debts while the increasing oil manufacturing in the United States serves as a counterbalance. Another problem had risen as the gasoline inventories unexpectedly rack up towards a surprising level.

According to EIA, the US crude production recorded 259 million barrels, reaching its highest level upon tracking back its data in 1990, making the worst gasoline glut after 27 years. The glut is caused by high volume of production by which the manufacturing in U.S. continuously expands towards a range of 9 to 10 mb/d.

The rising stocks for oil emerged due to the possible offline maintenance by the refiners, however, it is much more expected that the stockpile would decline. While the current case is that the inventories for refined products and crude both climb higher, therefore, the market has something to worry about. Moreover, the increase helped sustain the rising demand for oil.
 
February 21, 2017
UK Policymakers Clamor for more Transparency in Offshore Territories
Policymakers in the UK are pressuring UK PM Theresa May to increase transparency with regards to the business guidelines for offshore territories, including the British Virgin Islands. A total of 80 Parliament members are clamoring for amendments to the Criminal Finances Bill which is slated to be returned to the House of Commons next week. According to these Parliament members, the lack of transparency with regards to the business dealings within offshore territories such as Cayman Islands and Bermuda might be used by criminals as an advantage to hide ill-gotten assets as well as curb tax policies.
 
Launch of “Analytical Reviews” section


Dear clients!

We are glad to inform you about the launch of “Analytical Reviews” section on our website. Since then you won’t have to look for financial analytics on third-party resources – you just need to visit the relevant section on the ForexMart website.

In this new analytical section it will be possible to find up-to-date information about popular currency pairs, trade ideas and recommendations, as well as analytical reviews, forecasts, charts and overall description of the current market situation.

We hope that this innovation makes your trade more convenient and pleasant. Stay tuned and remain abreast of the latest economic trends with ForexMart!
 
February 22, 2017

Hong Kong Ex-Chair Tsang Charged with Misconduct, Faces 20-Month Jail Sentence

Donald Tsang, the ex-chief executive of Hong Kong, has just been charged with grave misconduct while in office and has been sentenced to 20 months’ worth of imprisonment. This recent event is now being tagged as a conclusion for a downfall of a former person of political power who helped Hong Kong get through its worst financial crisis some time ago. Tsang has been charged of failure to properly disclose a certain conflict which appeared after Tsang rented out a luxury apartment whose owner was then applying for a broadcasting license in Hong Kong.
 
February 22, 2017

Singapore-Britain Deeper Collaboration

The sovereign states, Britain and Singapore held yesterday the renewal of their bilateral ties proving their dedication for stronger links with regards to economy and business. The partnership was signed by the countries representatives, Lim Hng Kiang, Singapore’s Minister for Trade and Industry and Liam Fox, the Secretary of State for International Trade from Britain.

Mr.Lim stated that this joint commitment will fight against protectionism and will continue to implement the free and open trade policy. He added that they will further work for an environment that allows for an open global trading.

The arrangement supplemented new programs which involve building trade policy capacity and creating an appointed committee that supports greater collaboration regarding trade and investment of the two countries.
 
February 23, 2017

Decline in Australia’s Business Investments

Business investments in Australia dropped for the fourth straight quarter as miners lessened while other sectors had increased their plan for expenditures for the year giving a hint of recovery. On Thursday, the report from the Australian Bureau of Statistics showed the decline up to 2.1 percent for the fourth quarter amounting to A$27.6 billion equivalent to $21.18 billion, higher than the expected downturn of 1 percent.


This was mainly influenced by the mining sector where spending has declined by 9 percent despite the recent increase in investments in the manufacturing sector. Even if the expenses on equipaments, factories and machineries which could boost the economy, were not sufficient after an unexpected decline in the last quarter. It is anticipated for figures to reach 0.6 to 0.7 percent economic growth in reports next week.
 
February 23, 2017

Venezuelan Food Expenses Affected by the Economic Crisis

A couple of years later the negative growth in the economy of Venezuela continues which brought about depressing stories regarding scarcity and difficulties every month. A particular news was published that according to the yearly national survey, almost three-quarters of the citizens stated for suffering weight loss with an average of 19 pounds during 2015 up to 2016.

The National Survey of Living Condition were supervised by three major universities in the country together with other groups of researchers. Further results include that respondents cut their meals and apt to ate less than 2 meals per day with a percentage rate of 11.3 in 2015 up to 32.5 percent in the previous year with an equivalent of 9.6 million individual.

The economic tailspin in Venezuela started in 2014 due to recession in oil prices worldwide coupled with the unexpected government fiscal policy and excessive dependence towards imports which caused the economy to make an abrupt stop.
 
February 23, 2017

Fed Officials Not Too Eager on Implementing Rate Hike in March

Contrary to the general market sentiment, the FOMC is not so keen on raising interest rates this coming March and might wait until such time that the market feels right enough to actually implement a rate hike. The central bank is more keen than ever to implement at least three interest rate hikes this year but its officials are not losing their patience just yet to actually impose a rate hike anytime soon. However, this could change depending on the release of subsequent economic data in the coming days, as these will become indicators on whether there is an actual need for an interest rate hike from the Fed.
 
February 27, 2017

Expected Shift in Crude Futures as Much as $2B Will Put an End to Oil Glut


In the upcoming week, the passive investment funds are expected to rise to $2 billion from long-term to short-term crude futures, while the energy market surges after OPEC output reduced its supply. This is expected to put an end to global oil glut accumulated over two years of price war. Excessive oil supply in international inventories drove the prices to multiple year lows.


The Brent contract LCOK7 price established at $56.31 a barrel on May, while the LCOM7 price settled at $56.55 a barrel in June.On the other hand, the limit for the West Texas Intermediate crude remains the same. The gap between the first month and the subsequent month on Brent contracts LCOc1-LCOc2 has tightened from 79 cents down to 5 cents. However, both June and December contracts LCOM7-Z7 traded closely on Friday.
 
February 27, 2017

Macri’s Reforms Showed Signs for Economic Resurgence in Argentina

The economy of Argentina beefed up by 1.6% during the month of December compared with last month result according to the data from the government. This growth provided hints about the country’s possible expansion for the fourth quarter subsequent to an extensive economic depression. The Argentine Republic declined to 0.1% in December on an annualized basis and down by 2.3% in 2016 versus 2015. However, the current President of the country, Mauricio Macri executed several market-oriented reforms with a purpose of economic liberalization and inspiring additional investments which further influenced rampant inflation in the short-term.

The monthly development took place in December demonstrates the projected rebound of the economy in Q4 of 2016 following the four consecutive worst quarters. The INDEC, national statistics agency based in Buenos Aires, said the GDP data for Q4 is scheduled to release immediately after the nearby month.
 
GBP/USD Fundamental Analysis: February 28, 2017

The GBP/USD took a heavy hitting during the previous session as the pair’s bulls were unable to create a continuously good run for the pair since every time a bounce in the pair manifests, the pair immediately drops as it is met with major selloffs. There are still overshadowing concerns with the currency pair since the Brexit process is still ongoing, and this ensures that the GBP/USD pair will be unable to go higher for quite some time.

The GBP/USD pair was hit even more harder yesterday after rumors that Scotland is currently planning to implement another referendum in their favor in order to discern whether it would still be beneficial for them to continue becoming part of the UK. If this happens, then this would be disastrous for the UK economy since other parts of the UK might also be encouraged to do the same. This is probably the worst that could happen to the UK, especially since Scotland had initially voted to remain part of the European Union but was outvoted by the majority of UK members. But then further confirmation of this particular rumor never happened, and this caused the GBP/USD pair to bounce back from 1.2400 and is currently trading at just under 1.2450 points.

There are no major news releases expected from the UK today but the US will be releasing its Preliminary GDP data and consumer confidence data. The currency pair would most likely remain under pressure for today, with the 1.2500 barrier presenting a possibly limit to any kind of uptrend in the pair.
 
USD/CAD Fundamental Analysis: February 28, 2017

The USD/CAD had a strong bullish trade during the previous session after the bulls were able to regain its dominance over this particular currency pair. The bulls had previously attempted last week to gain control over the pair after the release of a dismal retail sales data from the Canadian economy but was eventually unable to do so after the release of a very strong CPI data. The bulls had also attempted to break through yesterday but has failed from last week’s range highs.

The currency pair’s strong resistance and support barriers of 1.3060 and 1.3000 respectively has led the market to believe that the USD/CAD pair is in for some major uptrend and is evident of the importance of the support barrier with regards to the struggle between the pair’s bulls and bears. Since the bears have constantly failed to break through this pair, the pair’s bears are currently in full dominance of the USD/CAD. The USD/CAD was previously consolidating within the 1.3100 barrier but a surge in the value of the USD helped in boosting the currency pair following’s Trump’s statement that he will be adding up the country’s infrastructure spending. The pair eventually increased in value after oil prices somewhat dropped in value.

This drop in oil prices could cause trouble for the USD/CAD pair in the short and medium term since Canada is very reliant on oil prices. The pair’s bears could become seriously affected once the dollar strength and weak oil prices come together since this could trigger the pair to move significantly upwards.

There are no major news coming from the Canadian economy today but the pair could get some volatility from the US consumer confidence data and Preliminary GDP which will be released today. The USD/CAD could possibly consolidate within 1.3100-1.3200 points with a bullish undertone.
 
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