Foreign exchange market: Currencies move in downgraded order : Orishas-finance

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Foreign exchange market: Currencies move in downgraded order

26/08/2024

Source : ORISHAS-FINANCE

Categories: Economy/Forex

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Foreign exchange market: Currencies move in downgraded order

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The South African rand weakened at the start of a week, while the Kenyan shilling remained stable and the rupee was rising. The Chinese yuan, Australian, New Zealand and American dollars are oscillating

The South African Rand weakened on Monday, ahead of a series of local economic data released this week, which could provide insights into the health of the local economy. At 0732 GMT, the rand was trading at 17.80 against the dollar, 0.51% lower than its previous close. The rand, like most emerging market currencies, benefitted from a weaker dollar on Friday after comments from Federal Reserve Chairman Jerome Powell consolidated bets of a rate cut in September

The Kenyan shilling held steady on Monday, with traders saying that market activity was moderate despite S&P Global downgrading the country's sovereign credit rating by S&P Global on Friday night.

At 08:13 GMT, LSEG data showed that the shilling was trading at 128.50/129.50 per US dollar, the same level it closed on Friday.

The Indian rupee is expected to rise on Monday, after comments from US Federal Reserve Chairman Jerome Powell nearly confirmed a rate cut in September, causing the dollar to fall again.

The 1-month undeliverable futures contract indicated that the rupee would open at 83.80-83.82 per US dollar, up from 83.89 in the previous session.

The Chinese yuan hovered near a three-week high against the dollar on Monday, supported by the general weakness of the greenback following the accommodative pivot of Federal Reserve Chairman Jerome Powell's accommodating pivot by Federal Reserve Chairman Jerome Powell, suggesting an imminent rate cut in the largest & world economy. At 03:05 GMT, the onshore yuan was trading at 7.1218 to the dollar, after reaching a three-week high of 7.1135 during initial trades. The yuan is up 1.4% against the dollar this month, recovering almost all of its losses in the first half of the year

Australian and New Zealand dollars were perched near their 2024 highs on Monday, supported by the near certainty that the American central bank will lower interest rates next month, although inflation tests both at home and abroad Foreign countries are on the horizon this week. The New Zealand dollar stood at $0.6227, after climbing 3% last week to $0.6236, marking the fourth consecutive week of gains. Both were supported by a general pullback in the US dollar, which plunged 1.7% against its main peers last week, as markets bet the Fed will start cutting rates in September, with even a 36% probability of an extraordinary move of 50 basis points

The dollar collapsed against the yen and hovered near its lowest level in 2 and a half years against the British pound after the Fed changed its tone Bookman Old Style”, "serif">. The dollar fell by 0.59% to 143.56 yen for the first time since August 5 in the early hours of the previous Monday, down 0.25% .The dollar index, which measures the value of the currency against a basket of six major currencies, including the euro, the pound sterling and the yen, stagnated at 100.64, just in below the 13-month low of 100.60 reached at the end of last week.

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