Here is what you need to know on Friday May 9:
THE US dollar (USD) The index remains in a consolidation phase slightly less than 100.50 after reaching its highest level in almost a month earlier in the day. Friday, in the absence of high -level data versions, market players pay particular attention to the comments of central bankers. At the start of the American session, Statistics Canada will publish job data in April.
US dollar price this week
The table below shows the percentage of variation in the US dollar (USD) compared to the main currencies listed this week. The US dollar was the strongest against the Canadian dollar.
| USD | Eur | GBP | Jpy | Goujat | Aud | Nzd | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.71% | -0.04% | 0.35% | 0.84% | 0.68% | 0.78% | 0.55% | |
| Eur | -0.71% | -0.47% | -0.10% | 0.39% | 0.24% | 0.34% | 0.10% | |
| GBP | 0.04% | 0.47% | 0.15% | 0.86% | 0.71% | 0.81% | 0.58% | |
| Jpy | -0.35% | 0.10% | -0.15% | 0.49% | 0.34% | 0.51% | 0.31% | |
| Goujat | -0.84% | -0.39% | -0.86% | -0.49% | -0.45% | -0.05% | -0.29% | |
| Aud | -0.68% | -0.24% | -0.71% | -0.34% | 0.45% | 0.09% | -0.14% | |
| Nzd | -0.78% | -0.34% | -0.81% | -0.51% | 0.05% | -0.09% | -0.24% | |
| CHF | -0.55% | -0.10% | -0.58% | -0.31% | 0.29% | 0.14% | 0.24% |
The thermal map shows the percentage of variations in the main currencies against each other. The basic currency is chosen in the left column, while the quotes motto is chosen in the upper row. For example, if you choose the US dollar in the left column and move along the horizontal line to the Japanese yen, the percentage of variation displayed in the box will represent USD (base) / JPY (quote).
The feature tone of the Federal Reserve (Fed) and the announcement of the USD-USE trade agreement strengthened the USD on Thursday. After increasing almost 0.8% over the day, the USD index continued to expand higher and hit its strongest level since April 11, almost 100.90 during Asian negotiation hours on Friday. Several political decision -makers of the Fed, including the president of the Fed of NY, John Williams, and the governor of the Fed, Christopher Waller, will pronounce speeches in the second half of the day. Meanwhile, the trade in future of the American stock market index mixed with the European session Friday after the main Wall Street indices closed Thursday in positive territory.
China's data showed early Friday that the commercial surplus increased to $ 96.18 billion in April, compared to $ 102.64 billion in March. On an annual basis, exports increased by 9.3%, while imports contracted by 0.2%. AUD / USD Marginally higher exchanges over 0.6400 to start the European session.
The Bank of England (BOE) announced Thursday that it had lowered the policy rate of 25 basic points (BPS) to 4.25%, as widely planned. In the policy statement, the BOE reiterated that a progressive and meticulous approach for additional withdrawal from the restraint of monetary policy remains appropriate. While speaking during the press conference after the meeting, the governor of Boe Andrew Bailey noted that the overall impact of inflation rates remains uncertain. GBP / USD Lost more than 0.3% Thursday and continued to drop earlier on Friday. At the time of the press, the pair was exchanged slightly above 1,3,250.
USD / JPY retained its bullish momentum and increased by more than 1% on Thursday. The pair is corrected earlier on Friday, but held above 145.00.
EUR / USD Friday, at its lowest level in almost a month below 1,1200 during the Asian session after finishing in negative territory for two consecutive days. The pair features a rebound and is negotiated nearly 1,1,250 in the morning in Europe.
Gold Thursday was subjected to a renewed lower pressure and dropped below $ 3,300. XAU / USD is gaining ground early Friday and is negotiated nearly $ 3,330.
Central Banks FAQ
Central banks have a key mandate that ensures that there is price stability in a country or region. The savings are constantly faced with inflation or deflation when the prices of certain goods and services fluctuate. The constant increase in prices for the same goods means inflation, the constant prices lowered for the same goods mean deflation. It is the task of the central bank to maintain demand online by refining its policy rate. For the largest central banks such as the American Federal Reserve (Fed), the European Central Bank (ECB) or the Bank of England (BOE), the mandate is to maintain inflation close to 2%.
A central bank has an important tool at its disposal to increase higher or lower inflation, and it is by refining its rate of reference policy, commonly known as interest rate. On pre-communicated moments, the Central Bank will publish a declaration with its policy rate and provide additional reasoning on the reasons why it is left or changed (hiking). Local banks will adjust their savings rates and their loan rates accordingly, which in turn will make people more difficult or easier for people to gain on their savings or for companies to contract loans and invest in their business. When the central bank considerably increases interest rates, this is called monetary tightening. When it reduces its reference rate, monetary softening is called.
A central bank is often politically independent. The members of the Central Bank Policy Board are going through a series of panels and audiences before being appointed to a seat of the board of directors. Each member of this council often has a certain conviction on how the central bank should control inflation and subsequent monetary policy. Members who wish a very loose monetary policy, with low levels and cheap loans, to considerably stimulate the economy while being contained to see inflation slightly greater than 2%, are called “doves”. Members who want to see higher rates to reward savings and want to keep an allusion to inflation at any time are called “hawks” and will not rest until inflation is below 2%.
Normally, there is a president or a president who directs each meeting, must create a consensus between the hawks or the doves and has his last word to be summed up in a vote to avoid equality of 50-50 on the fact that the current policy is adjusted. The President will pronounce speeches which can often be followed live, where the position and the current monetary perspectives are communicated. A central bank will try to advance its monetary policy without triggering violent fluctuations in rates, actions or its currency. All members of the central bank will channel their position towards the markets before a political meeting event. A few days before a political meeting takes place until the new policy is communicated, members are prohibited from speaking publicly. This is called the electricity period.
