Business

GBP is strongest and JPY is weakest


The strongest the weakest of the major currencies

The US and European markets (mostly) are closed, but the forex market is still trading. the GBP

GBP

The Pound Sterling (GBP) or Pound Sterling is the official currency of the United Kingdom, Jersey, Guernsey, Isle of Man, Gibraltar, South Georgia and other Pacific territories. The British pound is currently the fourth most traded currency in the world in foreign exchange markets after the US dollar, the euro and the Japanese yen. As the oldest currency in continuous use, the GBP holds significant weight in the global market and is also the fourth largest reserve currency. The Bank of England (BoE) is the authoritative central bank responsible for curating the GBP, issuing its own banknotes, as well as regulating the issuance of banknotes by private banks in Scotland and Northern Ireland. What factors affect the GBP? Like any widely traded currency, several factors affect the GBP. As is often the case, monetary policy has an extremely important impact. Any announcement or policy decision from the BoE is always closely watched given its potential to move the GBP. Additionally, consumer prices (CPI) in the UK as well as inflation levels carry a lot of weight and regularly affect the value of the GBP in the currency markets. Other metrics of note include measures of UK gross domestic product (GDP) or growth, consumer sentiment or confidence. More recently, the drama surrounding Brexit as well as the potential fallout from the negotiations has added another layer of uncertainty to the GBP. At the time of writing, the UK is heading towards a historic schism with Europe, although an agreement has yet to be reached with the two sides unable to reach a deal. With a smooth resolution nowhere in sight, any development or eventual outcome of Brexit will be hugely important to the GBP’s short- and long-term value.

The Pound Sterling (GBP) or Pound Sterling is the official currency of the United Kingdom, Jersey, Guernsey, Isle of Man, Gibraltar, South Georgia and other Pacific territories. The British pound is currently the fourth most traded currency in the world in foreign exchange markets after the US dollar, the euro and the Japanese yen. As the oldest currency in continuous use, the GBP holds significant weight in the global market and is also the fourth largest reserve currency. The Bank of England (BoE) is the authoritative central bank responsible for curating the GBP, issuing its own banknotes, as well as regulating the issuance of banknotes by private banks in Scotland and Northern Ireland. What factors affect the GBP? Like any widely traded currency, several factors affect the GBP. As is often the case, monetary policy has an extremely important impact. Any announcement or policy decision from the BoE is always closely watched given its potential to move the GBP. Additionally, consumer prices (CPI) in the UK as well as inflation levels carry a lot of weight and regularly affect the value of the GBP in the currency markets. Other metrics of note include measures of UK gross domestic product (GDP) or growth, consumer sentiment or confidence. More recently, the drama surrounding Brexit as well as the potential fallout from the negotiations has added another layer of uncertainty to the GBP. At the time of writing, the UK is heading towards a historic schism with Europe, although an agreement has yet to be reached with the two sides unable to reach a deal. With a smooth resolution nowhere in sight, any development or eventual outcome of Brexit will be hugely important to the GBP’s short- and long-term value.
Read this term is the strongest and the JPY is the weakest. The major currencies are all clustered very close together, with the yen the biggest outlier as it continues its bull run and trades towards a new high since 2002. With US rates continuing to climb, the spread with Japanese equivalent yields remains high. Comparing the US 10-year yield versus the Japanese 10-year yield, the spread is currently 253 basis points, which is close to the recent cycle high of 2.588% (which is the highest level since April 2019).

Yield gap

Yield spread between the United States 10-year and Japan 10-year

Although US stock and bond markets are closed, federal offices will be open. Just to prove it, the Federal Reserve

Federal Reserve

The Federal Reserve System, more commonly known as the Fed, represents the central banking system of the United States. Like other central banks around the world, the Fed is responsible for monetary policy, in this case in the United States. The Fed is one of the most watched and followed entities for forex traders, given its large impact on the US dollar. Originally founded in 1913, the Fed was created to perform a wide range of functions. This includes stabilizing and maintaining flexible monetary policy in the United States while strengthening a financial system for the country. Its general functions are to set and guide monetary policy and oversee the efficient functioning of the economy, both of which serve the public interest. by the Federal Reserve Board of Governors. The current interest rate and expectations of future interest rate changes can influence the value of the US dollar. For example, if traders anticipate a change in interest rates based on announcements from the Board of Governors, this may cause the US dollar to appreciate or depreciate against other currencies. Forex traders should always be aware of Fed meetings and announcements and should follow developments within the central bank. Ultimately, the Federal Open Market Committee (FOMC) holds eight regular meetings per calendar year, where policies and interest rates are discussed and agreed upon. The best course of action is to stay on top of the news ahead of these meetings as a forex trader to make predictions on interest rates and whether to buy or sell the US dollar.

The Federal Reserve System, more commonly known as the Fed, represents the central banking system of the United States. Like other central banks around the world, the Fed is responsible for monetary policy, in this case in the United States. The Fed is one of the most watched and followed entities for forex traders, given its large impact on the US dollar. Originally founded in 1913, the Fed was created to perform a wide range of functions. This includes stabilizing and maintaining flexible monetary policy in the United States while strengthening a financial system for the country. Its general functions are to set and guide monetary policy and oversee the efficient functioning of the economy, both of which serve the public interest. by the Federal Reserve Board of Governors. The current interest rate and expectations of future interest rate changes can influence the value of the US dollar. For example, if traders anticipate a change in interest rates based on announcements from the Board of Governors, this may cause the US dollar to appreciate or depreciate against other currencies. Forex traders should always be aware of Fed meetings and announcements and should follow developments within the central bank. Ultimately, the Federal Open Market Committee (FOMC) holds eight regular meetings per calendar year, where policies and interest rates are discussed and agreed upon. The best course of action is to stay on top of the news ahead of these meetings as a forex trader to make predictions on interest rates and whether to buy or sell the US dollar.
Read this term scheduled the release of industrial production and capacity utilization at 9:15 a.m. ET.

I looked back and in December it was also released on a Friday, but looking back in September the other release days covered all other days of the week. Thank you Federal Reserve. Go figure why it couldn’t have been released on Thursday or Monday?

It also looks like the NY Fed Empire State Manufacturing Index for April will be released at 8:30 a.m. ET.

The expectations for IP and capacity utilization are as follows:

  • capacity utilization 77.8 vs. 77.6 last month
  • industrial production 0.4% vs. 0.5% last month

For the New York Fed Empire manufacturing index, it is expected at 0.5 against -11.8 last month.

Bitcoin is trading (it never closes) and is currently trading at $40,235, up $321 on the day.


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