This is what you need to know to operate on Thursday, May 22:
The commercial action in the financial markets remains relatively calm in the early hours of Thursday while investors prepare for the preliminary data of the Purchase Management Index (PMI) of Germany, the Eurozone, the United Kingdom and the US Central banks will offer speeches later in the day.
US dollar price this week
The lower table shows the percentage of the US dollar change (USD) compared to the main currencies this week. American dollar was the weakest currency against Japanese and in Japanese.
| USD | EUR | GBP | JPY | CAD | Aud | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -1.17% | -1.02% | -1.38% | -0.79% | -0.58% | -0.72% | -1.33% | |
| EUR | 1.17% | 0.13% | -0.16% | 0.45% | 0.72% | 0.52% | -0.16% | |
| GBP | 1.02% | -0.13% | -0.60% | 0.32% | 0.59% | 0.39% | -0.29% | |
| JPY | 1.38% | 0.16% | 0.60% | 0.61% | 0.97% | 0.88% | 0.10% | |
| CAD | 0.79% | -0.45% | -0.32% | -0.61% | 0.23% | 0.07% | -0.61% | |
| Aud | 0.58% | -0.72% | -0.59% | -0.97% | -0.23% | -0.20% | -0.86% | |
| NZD | 0.72% | -0.52% | -0.39% | -0.88% | -0.07% | 0.20% | -0.68% | |
| CHF | 1.33% | 0.16% | 0.29% | -0.10% | 0.61% | 0.86% | 0.68% |
The heat map shows the percentage changes of the main currencies. The base currency is selected from the left column, while the contribution currency is selected in the upper row. For example, if you choose the US dollar of the left column and move along the horizontal line to the Japanese yen, the percentage change shown in the box will represent the USD (base)/JPY (quotation).
During the Asian negotiation hours on Thursday, the Chamber Rules Committee approved the broad draft tax cuts of US President Donald Trump. A complete vote is expected in the Plenary of the Chamber on the bill after a debate later in the day. Meanwhile, the yields of the US Treasury bonds shot late Wednesday after the weak demand observed in the auction of notes at 20 years. The 10 -year reference performance of the US rose more than 2.5% on Wednesday and reached its highest level since February above 4.6%. After closing in negative territory for three consecutive days, the US dollar index fluctuates in a narrow channel above 99.50.
EUR/USD It remains in a phase of consolidation above 1,1300 in the European morning on Thursday. Later in the session, the European Central Bank will publish the minutes of the monetary policy meeting.
GBP/USD He rose to his highest level in more than three years in 1,3470 on Wednesday, but erased a part of his daily profits in US negotiation hours. The pair fluctuates in a narrow range slightly above 1,3400 to start the European session.
Atsushi Mimura, Vice Minister of Finance of Japan for International Affairs and the main currency officer, said in the early hours of Thursday that they did not discuss the currency levels at the Meeting of Finance Ministers.USD/JPY It remains in a downt trend and trades in negative territory below 143.50.
Gold He acquired bullish impulse and rose above $ 3,300 on Wednesday. The Xau/USD remains firm and quotes about $ 3,330 in the European morning. The Wall Street Journal reported that President Trump told European leaders at the beginning of the week that Russian President Vladimir Putin is not ready to finish the war because he thinks he is winning.
FAQS risk feeling
In the world of financial jargon, the two terms “appetite for risk (Risk-on)” and “risk aversion (risk-off)” refers to the level of risk that investors are willing to support during the reference period. In a “Risk-on” market, investors are optimistic about the future and are more willing to buy risk assets. In a “Risk-Off” market, investors begin to “go to the safe” because they are concerned about the future and, therefore, buy less risky assets that are more certain of providing profitability, even if it is relatively modest.
Normally, during periods of “appetite for risk”, stock markets rise, and most raw materials – except gold – are also revalued, since they benefit from positive growth prospects. The currencies of countries that are large exporters of raw materials are strengthened due to the increase in demand, and cryptocurrencies rise. In a market of “risk aversion”, the bonds go up -especially the main bonds of the state -, the gold shines and the refuge currencies such as the Japanese yen, the Swiss Franco and the US dollar benefit.
The Australian dollar (Aud), the Canadian dollar (CAD), the New Zealand dollar (NZD) and the minor currencies, such as the ruble (Rub) and the South African Rand (Tsar), tend to rise in the markets in which there is “appetite for risk.” This is because the economies of these currencies depend largely on exports of raw materials for their growth, and these tend to rise in price during periods of “appetite for risk.” This is because investors foresee a greater demand for raw materials in the future due to the increase in economic activity.
The main currencies that tend to rise during the periods of “risk aversion” are the US dollar (USD), the Japanese yen (JPY) and the Swiss Franco (CHF). The dollar, because it is the world reserve currency and because in times of crisis investors buy American public debt, which is considered safe because it is unlikely that the world’s largest economy between in suspension of payments. The Yen, for the increase in the demand for Japanese state bonds, since a great proportion is in the hands of national investors who probably do not get rid of them, not even in a crisis. The Swiss Franco, because the strict Swiss bank legislation offers investors greater protection of capital.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
