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Hello everyone, today XM Forex will bring you "[XM Forex Decision Analysis]: A collection of good and bad news that affects the foreign exchange market." Hope this helps you! The original content is as follows:
The risk of the U.S. government shutdown has eased: The U.S. government shutdown has entered its 21st day, but there are signs that the deadlock may be about to end, which has improved investor risk appetite and led to capital flows to U.S. dollar assets, which is positive for the U.S. dollar. The U.S. dollar index climbed as traders weighed the Fed's outlook and political developments, amid strong bullish sentiment ahead of Friday's release of key U.S. consumer price index (CPI) inflation data.
The expected impact of the Federal Reserve policy: Although the Federal Reserve has suspended interest rate increases, its guidance is hawkish, which has led to a fall in interest rate cut expectations and an increase in U.S. bond yields. This has made the U.S. dollar more attractive and provided support for the U.S. dollar from an interest rate perspective.
German deflation caused the euro to fluctuate downward: The problem of German deflation continued to ferment, triggering a euro storm. Although the leaders of the European Central Bank (ECB) have spoken out one after another, it is difficult to restore the decline of the euro. As the largest economy in the Eurozone, Germany's deflation has impacted the stability of the euro. The euro has performed weakly in the foreign exchange market, and the 1.1600 support level is facing a test.
The ECB policy outlook is unclear: The ECB's policy stance is crucial to the euro, but its policy outlook is currently unclear. In the context of the divergence of the monetary policies of the world's major central banks, the ECB's decision-making faces many challenges, which has also affected investors' confidence in the euro and is not conducive to the trend of the euro.
The Bank of Japan said the economy and inflation are in line with expectations: Bank of Japan officials said the economy and inflation are in line with expectations, and it is still possible to raise interest rates during the year, but there is no clarity on next week’s meetingBasis for interest rate increase. This www.vifu.netment www.vifu.netplicates the market's expectations for the yen's trend, limiting the yen's upside potential to a certain extent.
Improving risk appetite weakens the demand for safe havens in the Japanese yen: As optimistic expectations for possible progress in Sino-US trade negotiations have increased, and the risk of a US government shutdown has eased, market risk appetite has improved, and investor demand for safe-haven assets has declined. As a traditional safe-haven currency, the demand for the Japanese yen has also been affected, and its trend is under pressure.
The exchange rate of the British pound against the U.S. dollar fell: According to foreign exchange market data, the exchange rate of the British pound against the U.S. dollar showed a downward trend, and the percentage increase or decrease in the exchange rate was -0.0075. This may be affected by factors such as the Bank of England's monetary policy stance and the UK's economic outlook. At the same time, the strength of the US dollar has also exerted some pressure on the pound.
The Canadian dollar was supported by Canadian CPI data: Canadian CPI rose 2.4% year-on-year in September, higher than the expected 2.3%. This data indicates that inflationary pressure in Canada has increased, which may affect the Bank of Canada's monetary policy decisions and provide certain support for the Canadian dollar from an inflation perspective.
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