Thread: ForexMart's Forex News

January 11. The Egyptian pound has fallen to a historic low

The Egyptian currency has fallen to a historic low. The exchange rate of the US dollar against the Egyptian pound rose today to the level of 32.195, adding 16.3%. Over the past 12 months, Egypt's national currency has depreciated by more than 76%.

The weakening of the pound began after the International Monetary Fund yesterday outlined the details of a $3 billion aid package to the country. Egypt has committed itself to introduce a flexible exchange rate, strengthen the role of the private sector in the country's economy, and carry out a number of monetary and fiscal reforms.

In addition, among its obligations is to reduce investments in state and national projects in order to reduce inflation and reduce foreign currency spending.

Recall that Egypt faced a shortage of foreign currency, despite the sharp depreciation of the Egyptian pound last year. A year ago, the currency was trading in a narrow range below 16 Egyptian pounds per dollar. However, in March and October 2022, the Central Bank of Egypt allowed the pound to depreciate sharply. On October 27, the Egyptian pound fell by 15% after the announcement of a new financing package from the International Monetary Fund. Then the regulator announced that it was moving to a more flexible currency regime.

You're correct, it is not an easy or instant thing to make a profit in forex trading. As a trader, you need to continue learning and training. By learning and practicing frequently, traders will understand and be better prepared to trade in a real account with Tickmill broker. Forex trading can be challenging, it takes time, patience, discipline and the right knowledge to be successful. It's not a get-rich-quick scheme and should not be treated as such.

January 12. Gold exceeded $1900 amid the inflation data in the United States

The price of the February gold futures soared by 1.28% today and reached $1905 per troy ounce. Above the $1,900 mark, gold is trading for the first time since May 2022.

The driver of growth to an eight-month high was the weakening of the dollar on the eve of the release of US inflation data for December. The dollar index lost 0.79% and reached 102.09 points, which was the lowest since June 2022. And as you know, the weakening of the dollar makes gold more attractive to holders of other currencies.

According to the US Department of Labor, by the end of December, the year-on-year growth in consumer prices slowed to 6.5% against 7.1% in November, which coincided with analysts' forecasts. Core inflation (excluding food and energy prices) at the end of December amounted to 5.7% year-on-year, which also meets the expectations of experts. In November, this figure was 6%.

Analysts note that the pressure on the US currency is also exerted by a decrease in the yields of US government bonds. This suggests that fears that inflation will remain at a high level, forcing the Fed to maintain a tight monetary policy for longer, are gradually weakening.

January 13. Germany's GDP grew by 1.9% in 2022

According to the Federal Statistical Agency of Germany, the German economy grew by 1.9% in 2022. For comparison, in 2021, the country's GDP increased by 2.6%. The average growth rate for the period from 2011 to 2021 was 1%.

As noted in the agency's report, Europe's largest economy suffered last year from the energy crisis, high inflation, rising interest rates and disruptions in supply chains. The Covid-19 pandemic, though fading, is also having its negative impact on the economy.

The volume of GDP last year was 0.7% higher than the indicator of the pre-pandemic 2019. The main engine of growth of the German economy was consumer spending, which increased by 4.6% in 2022 (by 0.4% in 2021), while the rate of increase in investment in fixed assets slowed to 0.2% from 1.2%, the growth rate of government spending decreased to 1.1% from 3.8%.

Exports of goods from Germany increased by 3.2% last year, and imports increased by 6.7%. Which, by the way, had a negative impact on the country's GDP.

The total deficit of public budgets in Germany in 2022 amounted to 101.631 billion euros (compared to 134.252 billion euros in 2021). Thus, the decrease was 24%.

The negative balance of the federal budget decreased to 117.633 billion euros from 145.925 billion euros.

Throughout 2022, an average of 45.6 million people worked in Germany, which is 589 thousand (1.3%) higher than in the previous year.

January 17. The price of gas in the EU has dropped to $600/thousand cubic meters

The cost of gas in Europe fell below the level of $600 per thousand cubic meters for the first time since the end of August 2021, against the background of a warm winter and the temperature norm approaching optimal values.

The contract with the delivery «a day ahead» at the TTF hub in the Netherlands dropped to $590 per thousand cubic meters. February futures – up to $615.

Analysts note that the warm weather in October, November and January, as well as cost-saving measures, have led to the fact that at the moment the level of gas reserves in underground gas storage facilities (UGS) is the highest in the history of observations. And this strengthens the confidence of the authorities in the safe passage of winter.

According to Gas Infrastructure Europe (GIE) data from January 15, Europe's UGS are 81.49% full. In addition, gas quotes are affected by high wind power generation rates.

At the same time, Asian quotes remain significantly higher than European ones. In particular, the February futures on the JKM Platts index (Japan Korea Marker, reflecting the spot market value of goods shipped to Japan, South Korea, China and Taiwan) is located at $957.

Recall that on December 19, 2022, the EU countries agreed on a ceiling of gas prices in the amount of 180 euros per 1 MWh, (or $ 1975 per 1000 cubic meters). This price limit will take effect from February 15. The ceiling will be activated if the price of gas for TTF exceeds the agreed mark, and the spread to the price of liquefied natural gas in the EU will be more than 35 euros per 1 MWh. It is worth noting that the price ceiling will not apply to over-the-counter transactions.

January 19. The share of the pound in international settlements fell to a June low​​​​​​​

According to the SWIFT international system, the share of the pound sterling in international settlements by the end of December fell to 6.08%, which was the lowest value since June.

During the month, the British currency lost 1.01 percentage points, while retaining third place in the list of the most popular settlement currencies. The last time when the value was much less than the current one, it was noted in June: then the pound accounted for 5.96% of international settlements.

Analysts note that the dollar and the euro have strengthened their positions in the rating of currencies – they took first and second places with a share of 41.89% and 36.34%, respectively. The «American» for the month grew by 0.51 percentage points, and the «European» — by 0.22 points.

The Japanese yen is still in fourth place at the end of December, the share of which increased by 0.34 percentage points to 2.88% over the month.

The Chinese yuan closes the top five with a share of 2.15% and a decrease of 0.22 percentage points over the month.

January 23. Retail sales in Britain showed a record drop since 1997

According to the UK Bureau of National Statistics, retail sales in December 2022 decreased by 5.8% compared to the same period in 2021. This was a record drop in the entire history of observations since 1997.

According to the ONS, retail sales in Britain have declined for the second month in a row. In December, they unexpectedly fell by 1%, which is twice as much as the 0.5% predicted by analysts. In November, the drop was also 0.5%.

The State Bureau also reported that the sales volumes recorded in December were 1.7% less than in February 2020 before the outbreak of the coronavirus pandemic. Total retail sales fell by 3% between 2021 and 2022.

Analysts note that after the start of the special operation of the Russian Federation in Ukraine, the West increased sanctions pressure on Russia. As a result, the disruption of logistics chains has led to an increase in fuel and food prices in Europe and the United States. In the UK itself, the rising cost of living has hit millions of households.

Recall that the Bank of England raised the base interest rate by 50 basis points – from 3% to 3.5%. The regulator also announced the beginning of a recession in the country, which will last the whole of 2023 and the first half of 2024. Annual inflation in the UK at the end of December was 10.5%.

January 25. Microsoft shares fell amid the release of a weak report

Microsoft shares jumped 5.26% to $254.79 in postmarket trading. However, then the dynamics changed, and according to the results of the postmarket, the IT giant's securities fell by 1.02%, to $234.64.

On Tuesday, Microsoft released its financial report for the second fiscal quarter, which ended in December 2022. The company reported a 7% decrease in adjusted net profit to $17.4 billion. Earnings per share (EPS) fell 6% to $2.32. At the same time, analysts predicted EPS at $2.29.

Microsoft's total revenue grew by 2% and reached $52.75 billion, while Wall Street forecast $52.94 billion. This was the lowest increase in quarterly revenue since 2016.

Experts also note that Microsoft is increasingly becoming cloud-based. The share of various kinds of cloud services already accounts for 40% of revenue and more than 40% of operating profit. At the same time, the corporation began to earn less in other segments. Thus, revenues from PC products, including the Microsoft Windows operating system and Office software, decreased by 19% to $14.2 billion.

The corporation also gave a forecast that disappointed investors: it is expected that in the third fiscal quarter revenue will be from $50.5 billion to $51.5 billion, which is about 3% more than a year earlier. Analysts predicted that revenue in the current quarter would be $52.43 billion.

January 26. Brent crude oil exceeded the level of $87 per barrel

On Thursday, the oil market shows steady growth: Brent quotes rose to the level of $87.50 per barrel. The North American grade of WTI oil is trading today near the level of $81.50 per barrel.

Traders continue to evaluate data on fuel stocks in the United States. According to the report of the Ministry of Energy, commercial oil reserves increased by 533 thousand barrels last week. The growth of reserves was recorded for the fifth week in a row.

Gasoline inventories increased by 1.76 million barrels, while distillate inventories decreased by 507 thousand barrels. Analysts predicted an increase in oil reserves by 1.5 million barrels, an increase in gasoline reserves by 1.5 million barrels and a drop in distillate reserves by 1.6 million barrels.

Experts note that the data of the Ministry of Energy reflected what the market has been putting into quotes in recent weeks: the growing premium of Brent compared to WTI since the end of December leads to an increase in exports, which limits the growth of stocks, despite the weak workload of American refineries.

Investors are also assessing the risks of a recession in the global economy and the prospects for fuel demand in China. Fears of a recession and the weakening of hopes for a «soft landing» for the economy remain negative factors for the market. At the same time, analysts expect that optimism about a sharp recovery in demand in China will support oil quotes in the near future.

January 27. Central banks are buying gold at the fastest pace in half a century

According to a report by economists of the International Monetary Fund and the University of California at Berkeley, gold not only did not leave the international reserve currency, but also significantly increased its performance, as the gold reserves of the world's central banks increased after the global financial crisis of 2008-2009.

Experts note that in the third quarter of 2022, leading central banks bought more gold than in any other quarter for 55 years. The main buyers at the same time were banks of developing countries, such as Russia, China, India, Turkey, Argentina, Hungary and Belarus.

Among the main reasons for the increase in purchases, analysts note the popularity of gold as a traditional and safe means of saving at a time when a number of countries are subject to financial sanctions.

An interesting fact is that Russia, Iran and other countries that are subject to US sanctions can now combine blockchain technologies with gold to launch a digital currency that can compete with the dollar. Blockchain will allow these countries to make transactions with gold without actually redirecting coins or bullion.

Moreover, gold today is the only significant asset that is not controlled by any country and that cannot be forged. It is also the only asset that largely guarantees financial confidentiality.