Forex News
On Monday, the People’s Bank of China (PBOC) sets the USD/CNY central rate for the trading session ahead at 6.8657 compared to Friday's of 6.8654 and 6.8395 Reuters estimate.
PBOC FAQs
The primary monetary policy objectives of the People's Bank of China (PBoC) are to safeguard price stability, including exchange rate stability, and promote economic growth. China’s central bank also aims to implement financial reforms, such as opening and developing the financial market.
The PBoC is owned by the state of the People's Republic of China (PRC), so it is not considered an autonomous institution. The Chinese Communist Party (CCP) Committee Secretary, nominated by the Chairman of the State Council, has a key influence on the PBoC’s management and direction, not the governor. However, Mr. Pan Gongsheng currently holds both of these posts.
Unlike the Western economies, the PBoC uses a broader set of monetary policy instruments to achieve its objectives. The primary tools include a seven-day Reverse Repo Rate (RRR), Medium-term Lending Facility (MLF), foreign exchange interventions and Reserve Requirement Ratio (RRR). However, The Loan Prime Rate (LPR) is China’s benchmark interest rate. Changes to the LPR directly influence the rates that need to be paid in the market for loans and mortgages and the interest paid on savings. By changing the LPR, China’s central bank can also influence the exchange rates of the Chinese Renminbi.
Yes, China has 19 private banks – a small fraction of the financial system. The largest private banks are digital lenders WeBank and MYbank, which are backed by tech giants Tencent and Ant Group, per The Straits Times. In 2014, China allowed domestic lenders fully capitalized by private funds to operate in the state-dominated financial sector.
- US Dollar Index may regain ground as safe-haven demand rose following the failure of the US–Iran peace talks.
- Vice President JD Vance confirmed US–Iran talks in Islamabad ended without a deal after 21 hours of negotiations.
- Stronger March US CPI reinforced the Fed’s higher-for-longer stance, signaling rates may stay elevated for longer.
The US Dollar Index (DXY), which measures the value of the US Dollar (USD) against six major currencies, is remaining in the positive territory after paring daily gains and trading around 99.00 during the Asian hours on Monday.
However, the Greenback gained ground on increased safe-haven demand following the failure of the United States (US)-Iran peace talks. US Vice President JD Vance confirmed the US–Iran talks in Islamabad ended without a deal following 21 hours of negotiations.
US President Donald Trump said Washington would begin blockading all ships entering or leaving the Strait of Hormuz, while US Central Command (CENTCOM) confirmed operations targeting maritime traffic to and from Iranian ports from 10 AM ET (14:00 GMT) Monday.
Moreover, the US Dollar receives support as the US Consumer Price Index (CPI) March data reinforced the Federal Reserve’s (Fed) higher-for-longer stance. The US Bureau of Labor Statistics (BLS) reported on Friday that annual CPI rose to 3.3% in March from 2.4% in February, matching expectations. On a monthly basis, CPI increased 0.9% after 0.3% previously. Meanwhile, core CPI rose 0.2% month-over-month and 2.6% year-over-year.
San Francisco Fed President Mary Daly told Reuters that if inflation remains elevated, the Fed will hold rates steady until price stability is achieved. However, Daly added that a rate cut is possible if the Iran conflict eases quickly and oil prices decline.
US Dollar FAQs
The US Dollar (USD) is the official currency of the United States of America, and the ‘de facto’ currency of a significant number of other countries where it is found in circulation alongside local notes. It is the most heavily traded currency in the world, accounting for over 88% of all global foreign exchange turnover, or an average of $6.6 trillion in transactions per day, according to data from 2022. Following the second world war, the USD took over from the British Pound as the world’s reserve currency. For most of its history, the US Dollar was backed by Gold, until the Bretton Woods Agreement in 1971 when the Gold Standard went away.
The most important single factor impacting on the value of the US Dollar is monetary policy, which is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability (control inflation) and foster full employment. Its primary tool to achieve these two goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, the Fed will raise rates, which helps the USD value. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates, which weighs on the Greenback.
In extreme situations, the Federal Reserve can also print more Dollars and enact quantitative easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used when credit has dried up because banks will not lend to each other (out of the fear of counterparty default). It is a last resort when simply lowering interest rates is unlikely to achieve the necessary result. It was the Fed’s weapon of choice to combat the credit crunch that occurred during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy US government bonds predominantly from financial institutions. QE usually leads to a weaker US Dollar.
Quantitative tightening (QT) is the reverse process whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing in new purchases. It is usually positive for the US Dollar.
- AUD/USD shows some resilience below the 0.7000 and rebounds from a confluence support.
- Rising geopolitical tensions continue to underpin the USD and might cap gains for spot prices.
- The mixed technical setup also warrants caution before positioning for further intraday gains.
The AUD/USD pair opens with a bearish gap at the start of a new week, though it lacks follow-through and recovers around 40 pips from the Asian session low levels below the 0.7000 psychological mark. Spot prices currently trade around the 0.7030 area, still down 0.50% for the day, amid a fresh wave of the global risk-aversion trade.
High-level negotiations between the US and Iran ended without a breakthrough, despite nearly 21 hours of intense discussions over the weekend, jeopardizing a fragile two-week ceasefire. Adding to this, US President Donald Trump said that the US Navy would start blockading the Strait of Hormuz, raising the risk of a further escalation of tensions in the Middle East. This, in turn, tempers investors' appetite for riskier assets, which provides a goodish lift to the safe-haven US Dollar (USD) and exerts heavy pressure on the AUD/USD pair.
Furthermore, a sharp intraday rally in Crude Oil prices revives inflationary concerns, reaffirming bets for a more hawkish US Federal Reserve (Fed) and triggering a fresh leg up in US Treasury bond yields. This turns out to be another factor that benefits the buck. That said, reports that regional countries are working to bring the US and Iran back to the negotiating table within days keep the door open for further diplomacy, and cap the USD. This, along with the Reserve Bank of Australia's (RBA) hawkish tilt, lends support to the AUD/USD pair.
From a technical perspective, spot prices rebound from a confluence support, comprising the 200-hour Exponential Moving Average (EMA) and the 38.2% Fibonacci retracement level of the upswing from the late March low. This suggests that buyers are defending the 0.7000 area. Meanwhile, the Relative Strength Index (RSI) has recovered from oversold territory toward the high 30s, while the Moving Average Convergence Divergence (MACD) holds in negative territory with a flat profile. This suggests that bearish momentum is fading but not yet reversed.
Meanwhile, a sustained strength above the 23.6% Fibo. retracement at 0.7032 would expose the Fibonacci anchor near 0.7093. On the downside, initial support is aligned around the 200-period EMA at 0.6996 and the clustered 38.2% Fibo. retracement at 0.6995. A decisive break below this zone would open the way toward deeper Fibonacci supports at 0.6964 and 0.6934, with 0.6891 and 0.6835 following as lower structural floors if selling pressure resumes.
(The technical analysis of this story was written with the help of an AI tool.)
AUD/USD 1-hour chart
Risk sentiment FAQs
In the world of financial jargon the two widely used terms “risk-on” and “risk off'' refer to the level of risk that investors are willing to stomach during the period referenced. In a “risk-on” market, investors are optimistic about the future and more willing to buy risky assets. In a “risk-off” market investors start to ‘play it safe’ because they are worried about the future, and therefore buy less risky assets that are more certain of bringing a return, even if it is relatively modest.
Typically, during periods of “risk-on”, stock markets will rise, most commodities – except Gold – will also gain in value, since they benefit from a positive growth outlook. The currencies of nations that are heavy commodity exporters strengthen because of increased demand, and Cryptocurrencies rise. In a “risk-off” market, Bonds go up – especially major government Bonds – Gold shines, and safe-haven currencies such as the Japanese Yen, Swiss Franc and US Dollar all benefit.
The Australian Dollar (AUD), the Canadian Dollar (CAD), the New Zealand Dollar (NZD) and minor FX like the Ruble (RUB) and the South African Rand (ZAR), all tend to rise in markets that are “risk-on”. This is because the economies of these currencies are heavily reliant on commodity exports for growth, and commodities tend to rise in price during risk-on periods. This is because investors foresee greater demand for raw materials in the future due to heightened economic activity.
The major currencies that tend to rise during periods of “risk-off” are the US Dollar (USD), the Japanese Yen (JPY) and the Swiss Franc (CHF). The US Dollar, because it is the world’s reserve currency, and because in times of crisis investors buy US government debt, which is seen as safe because the largest economy in the world is unlikely to default. The Yen, from increased demand for Japanese government bonds, because a high proportion are held by domestic investors who are unlikely to dump them – even in a crisis. The Swiss Franc, because strict Swiss banking laws offer investors enhanced capital protection.
- NZD/USD kicks off the new week on a weaker note as renewed geopolitical risks boost the USD.
- Trump said that the US Navy would start blockading the Strait of Hormuz after failed US-Iran talks.
- Rallying Oil prices revive inflationary fears and reaffirm hawkish Fed bets, also benefiting the USD.
The NZD/USD pair opens with a bearish gap at the start of a new trading week in reaction to failed US-Iran peace talks over the weekend and trades around the 0.5800 mark during the Asian session.
High-level negotiations between the US and Iran ended without a breakthrough, despite nearly 21 hours of intense discussions mediated by Pakistan. US Vice President JD Vance said that Washington placed its final and best offer on the table, but Tehran declined to accept the terms, leading to a stalemate. Furthermore, US President Donald Trump said on Sunday the US Navy would start blockading the Strait of Hormuz, jeopardizing a fragile two-week ceasefire. This, in turn, takes a toll on the global risk sentiment, which is seen underpinning the safe-haven US Dollar (USD) and weighing on the NZD/USD pair.
Meanwhile, the latest developments raise the risk of a further escalation of tensions in the Middle East and fuel concerns about a deepening global energy crisis, triggering a sharp rally in Crude Oil prices and reviving inflation fears. This comes on top of data released on Friday, which showed that US inflation surged in March by the most in nearly four years, and reaffirms bets for a more hawkish stance by the US Federal Reserve (Fed). The outlook remains supportive of a fresh leg up in US Treasury bond yields and further benefits the Greenback, contributing to the heavily offered tone surrounding the NZD/USD pair.
The Wall Street Journal reported that regional countries are working to bring the US and Iran back to the negotiating table within days, keeping the door open for further diplomacy. This helps limit the pessimism and caps the USD, offering some support to the pair. Nevertheless, the aforementioned fundamental backdrop seems tilted in favor of bearish traders, suggesting that any attempted recovery is more likely to be sold into. Hence, it will be prudent to wait for strong follow-through buying before traders start positioning for the resumption of the NZD/USD pair's recent bounce from the year-to-date trough.
US Dollar Price Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.36% | 0.49% | 0.29% | 0.19% | 0.51% | 0.41% | 0.43% | |
| EUR | -0.36% | 0.11% | -0.06% | -0.16% | 0.14% | 0.05% | 0.11% | |
| GBP | -0.49% | -0.11% | -0.19% | -0.30% | 0.01% | -0.06% | -0.05% | |
| JPY | -0.29% | 0.06% | 0.19% | -0.14% | 0.19% | 0.09% | 0.18% | |
| CAD | -0.19% | 0.16% | 0.30% | 0.14% | 0.36% | 0.24% | 0.25% | |
| AUD | -0.51% | -0.14% | -0.01% | -0.19% | -0.36% | -0.09% | 0.00% | |
| NZD | -0.41% | -0.05% | 0.06% | -0.09% | -0.24% | 0.09% | 0.05% | |
| CHF | -0.43% | -0.11% | 0.05% | -0.18% | -0.25% | -0.00% | -0.05% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
- Silver falls as rising energy prices fuel inflation, reducing expectations for Fed and global rate cuts.
- CENTCOM said US forces will begin blockading all maritime traffic to and from Iranian ports at 10 AM ET Monday.
- Stronger March US CPI reinforced the Fed’s higher-for-longer stance, signaling rates may stay elevated for longer.
Silver price (XAG/USD) halts its five-day winning streak, falling over 2.5% and trading around $73.80 per troy ounce during the Asian hours on Monday. The non-interest-bearing white metal loses appeal as the effective shutdown of the Strait of Hormuz drives energy prices higher, heightening inflation and reinforcing expectations that the Federal Reserve (Fed) and other central banks may delay rate cuts or even tighten policy further.
West Texas Intermediate (WTI) opened the week with a bullish gap, trading about 7.5% higher near $97.10 per barrel at the time of writing. Crude oil prices rise due to the re-escalation of the conflict between the United States (US) and Iran.
US President Donald Trump said Washington would begin blockading all ships entering or leaving the Strait of Hormuz after US–Iran peace talks in Islamabad collapsed. The US Central Command (CENTCOM) added that forces will start blockading all maritime traffic to and from Iranian ports at 10 AM ET (14:00 GMT) on Monday.
Stronger US Consumer Price Index (CPI) March data reinforced the Federal Reserve’s (Fed) higher-for-longer stance. The US Bureau of Labor Statistics (BLS) reported on Friday that annual CPI rose to 3.3% in March from 2.4% in February, matching expectations. On a monthly basis, CPI increased 0.9% after 0.3% previously. Meanwhile, core CPI rose 0.2% month-over-month and 2.6% year-over-year.
Silver FAQs
Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.
Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.
Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
- Gold declines as rising energy prices boost inflation, dampening expectations for Fed and global central bank rate cuts.
- WTI jumps about 8.5% as US–Iran conflict escalates, raising supply disruption concerns.
- CENTCOM said forces will begin blockading all maritime traffic to and from Iranian ports at 10 AM ET Monday.
Gold price (XAU/USD) moves little after opening at a gap down, hovering around $4,670 per troy ounce during the Asian trading hours on Monday. The non-yielding metal struggles as rising energy prices fuel inflation risks, reducing expectations for rate cuts by the US Federal Reserve (Fed) and other major central banks.
West Texas Intermediate (WTI) oil price has opened the week with a bullish gap, climbing roughly 8.5%, and is trading around $98.00 per barrel at the time of writing. The latest surge in oil prices is mainly driven by the re-escalation of the conflict between the United States (US) and Iran.
US President Donald Trump said Washington would begin blockading all ships entering or leaving the Strait of Hormuz after the announcement of the failure of US-Iran peace talks in Islamabad. Moreover, the US Central Command (CENTCOM) said forces will begin blockading all maritime traffic entering and exiting Iranian ports at 10 AM ET (14:00 GMT) on Monday.
Friday’s hot US Consumer Price Index (CPI) data reinforced the Fed’s higher-for-longer stance. The US Bureau of Labor Statistics (BLS) reported that annual CPI rose to 3.3% in March from 2.4% in February, matching expectations. On a monthly basis, CPI increased 0.9% after 0.3% previously. Meanwhile, core CPI rose 0.2% month-over-month and 2.6% year-over-year.
Gold FAQs
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
- USD/CAD extends the rebound as the US Dollar regains safe-haven demand amid US-Iran re-escalation.
- The commodity-linked Canadian Dollar could draw support from surging WTI prices, following the US blockades to the Strait of Hormuz.
- Middle East headlines are set to remain the main driver for the USD/CAD pair.
The Canadian Dollar (CAD) is extending its pullback from two-week highs of 1.3844 against the US Dollar (USD) early Monday, with USD/CAD capitalizing on the renewed demand for the Greenback as a go-to safe-haven.
The USD rejoices new phase of escalation in the US-Iran war as the recent ceasefire agreement appears at risk following the weekend breakdown of peace talks between both sides.
In the aftermath of the fallout, US President Donald Trump vowed blockades to the Strait of Hormuz, while considering resuming limited military strikes in Iran in an attempt to break a gridlock in peace talks.
However, the further upside in the USD/CAD pair appears limited amid the extensive surge in Oil price, in the face of the Middle East re-escalation and a potential threat to the US-Iran ceasefire agreement.
West Texas Intermediate (WTI) – the US oil benchmark opened with a bullish gap and rallied as much as 8% in the weekly opening hours. The black gold is aiming for a retest of the $100 mark, as of writing.
Canadian Dollar Price Today
The table below shows the percentage change of Canadian Dollar (CAD) against listed major currencies today. Canadian Dollar was the weakest against the US Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.45% | 0.56% | 0.24% | 0.25% | 0.70% | 0.62% | 0.45% | |
| EUR | -0.45% | 0.10% | -0.22% | -0.21% | 0.22% | 0.17% | 0.04% | |
| GBP | -0.56% | -0.10% | -0.30% | -0.32% | 0.13% | 0.07% | -0.09% | |
| JPY | -0.24% | 0.22% | 0.30% | -0.04% | 0.41% | 0.34% | 0.24% | |
| CAD | -0.25% | 0.21% | 0.32% | 0.04% | 0.49% | 0.40% | 0.22% | |
| AUD | -0.70% | -0.22% | -0.13% | -0.41% | -0.49% | -0.05% | -0.14% | |
| NZD | -0.62% | -0.17% | -0.07% | -0.34% | -0.40% | 0.05% | -0.14% | |
| CHF | -0.45% | -0.04% | 0.09% | -0.24% | -0.22% | 0.14% | 0.14% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Canadian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent CAD (base)/USD (quote).
- GBP/USD depreciates as the US Dollar gains on increased risk aversion.
- CENTCOM said forces will begin blockading all maritime traffic to and from Iranian ports at 10 AM ET on Monday.
- Russia and Ukraine accused each other of breaching an Easter ceasefire, reporting over 1,000 drone and shelling attacks.
GBP/USD halts its five-day winning streak, trading at a gap down around 1.3390 during the Asian hours on Monday. The risk-sensitive pair faces challenges on renewed risk aversion following the failure of the United States (US)-Iran peace talks.
The safe-haven demand boosted the US Dollar (USD) against its major peers after Vice President JD Vance confirmed US–Iran talks in Islamabad ended without a deal following 21 hours of negotiations.
US President Donald Trump said Washington would begin blockading all ships entering or leaving the Strait of Hormuz, while US Central Command (CENTCOM) confirmed operations targeting maritime traffic to and from Iranian ports from 10 AM ET (14:00 GMT) on Monday.
Iran’s Parliament Speaker Mohammad Bagher Ghalibaf said that despite “constructive initiatives,” the US failed to gain Tehran’s trust, leaving the decision with Washington. The Revolutionary Guard (IRGC) warned that any military vessels approaching the Strait of Hormuz would violate the ceasefire and face a decisive response.
The Pound Sterling (GBP) advanced against the US Dollar, supported by optimism over a potential Russia–Ukraine peace deal after signs of progress in negotiations. However, both sides accused each other of violating a 32-hour Orthodox Easter ceasefire, reporting over a thousand drone and shelling attacks shortly after the truce began.
Pound Sterling FAQs
The Pound Sterling (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most traded unit for foreign exchange (FX) in the world, accounting for 12% of all transactions, averaging $630 billion a day, according to 2022 data. Its key trading pairs are GBP/USD, also known as ‘Cable’, which accounts for 11% of FX, GBP/JPY, or the ‘Dragon’ as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE).
The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of “price stability” – a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates. When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money. When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects.
Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP. A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall.
Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
West Texas Intermediate (WTI) – the US oil benchmark – has opened the week with a bullish gap, climbing roughly 8%, looking to retarget the $100 threshold.
Following a down week, the latest surge is mainly driven by the re-escalation of the conflict between the United States (US) and Iran.
The 21-hour-long peace talks over the weekend failed and prompted US President Donald Trump to pledge to blockading Iranian ports and the maritime traffic via the Strait of Hormuz.
The US Central Command (CENTCOM) announced that the “Forces will start blockade of all maritime traffic entering and exiting Iranian ports on Monday, 10 AM ET” (14:00 GMT).
Meanwhile, the latest Wall Street Journal Report (WSJ) report stated that President Trump and his advisers are weighing restarting limited military strikes in Iran in addition to the US blockade of the Strait of Hormuz as a way to break a standoff in peace talks.
Looking ahead, the focus remains on further details of the US blockades to the Strait and its implications on the already fragile US-Iran ceasefire.
WTI Oil FAQs
WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.
Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.
The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
Forex Market News
Our dedicated focus on forex news and insights empowers you to capitalise on investment opportunities in the dynamic FX market. The forex landscape is ever-evolving, characterised by continuous exchange rate fluctuations shaped by vast influential factors. From economic data releases to geopolitical developments, these events can sway market sentiment and drive substantial movements in currency valuations.
At Rakuten Securities Hong Kong, we prioritise delivering timely and accurate forex news updates sourced from reputable platforms like FXStreet. This ensures you stay informed about crucial market developments, enabling informed decision-making and proactive strategy adjustments. Whether you’re monitoring forex forecasts, analysing trading perspectives, or seeking to capitalise on emerging trends, our comprehensive approach equips you with the insights needed to navigate the FX market effectively.
Stay ahead with our comprehensive forex news coverage, designed to keep you informed and prepared to seize profitable opportunities in the dynamic world of forex trading.
