Subscribe to RSS

Emerging market currencies pain continues as recent history repeats itself

In line with expectations, markets concluded the week suffering losses with the combination of alarming data from China and resumed selling in commodities weighing heavily on investor sentiment. With economic data from China causing concern and the depressed commodity prices leading to pressures on both global inflation prospects and those economies reliant on commoditylinked exports, it does look like recent history is repeating itself from the beginning of the year where the divergence in economic sentiment between the United States and those suffering from changing market conditions was heavily highlighted.

While the economic momentum in the US might not be as powerful as it was at the start of the year, the data remains robust and job creation is consistently proving itself to be the star performer of the US economy. At the same time, economic data from China continues to threaten further weakness in the economy and the figures from Europe remain largely unconvincing. This basically means that we are looking at the increased prospects of the divergence in economic sentiment between the United States and everywhere else returning as a dominant theme in market sentiment once again. When you also take into account that the Federal Reserve should be raising US interest rates during the second half of the year and I still expect the first interest rate hike to occur in September, this paints an overall positive picture for the USD.

What I am paying close attention towards right now is the emerging markets because these currencies are taking complete punishment from numerous different directions. A wide collection of currencies from the emerging markets have hit milestone lows within the previous nine months, with this being a global phenomenon not restricted to any specific geographical regions. This has included the currencies of Brazil, Chile, Columbia, Indonesia, Malaysia, Mexico, South Africa, Turkey and Russia with the reason for the damage to these currencies extending much further than the US interest rate outlook.

It is the combination of the threat of slowing trade from China, the price of commodities having not yet found a floor, and the expectations for the Federal Reserve to begin normalising monetary policy, that are behind this suffering and with these threats showing no signs of going away, these currencies are still exposed to further lows. It is important to begin stepping away from looking at the US interest rate outlook because the US economy is performing consistently and it is just a matter of time now before the Federal Reserve begin raising Interest rates. What does this mean? It is time to begin focusing on China because the correlation between concerns over China data and consequent pressure in commodities is extensive.

What investors and those interested in the emerging markets really need to begin focusing attention on is the economic data from China and resumed selling in commodities. The bottom line is that although the China GDP target of 7% is seen as a crucial benchmark after the government announced this level at its objective for growth, China can actually handle slower than expected growth as it attempts to shift its economy towards being more domestically inspired. However, other economies cannot handle a China that is possibly entering a deeper than previously expected downturn with this weighing on raw material exports and this ultimately means there could be more punishment when it comes to the pressures in the emerging markets.

0 commentsback to post

Add your comment

Nickname:
E-mail:
Website:
Comment:

Other articlesgo to homepage

$5000 BitCoin Rewards Bonus Forex Promotion – UFX

$5000 BitCoin Rewards Bonus Forex Promotion – UFX(0)

$5000 BitCoin Rewards Bonus Forex Promotion. Only with UFX Broker can you Trading  BitCoin without the need of a Bitcoin exchange or any complicated Bitcoin wallets and addresses. Link:  $5000 BitCoin Rewards Bonus Promo Link:  $50 Free and Trade in Three Steps Link:  $50 Free No Deposit Bitcoin Bonus Link:  100% Real Money CashBack Promotion

300% Tradable Bonus Promo up to $3000 – MarketsYes

300% Tradable Bonus Promo up to $3000 – MarketsYes(0)

300% Tradable Bonus Promotion up to $3000. MarketsYes is offering all prospective clients’ deposit for up to 3000 USD/EUR/GBP a 300% Forex Tradable Bonus. Link:  300% Tradable Bonus Promotion Link:  Risk Free Trade plus Forex Free Signals Available to: All new traders Ending Date: 31 December 2018 Bonus Offer: 300% Tradable Bonus Promotion up to

Get 300% Ramadan Welcome Bonus Campaign – FBS

Get 300% Ramadan Welcome Bonus Campaign – FBS(0)

Get 300% Ramadan Welcome Bonus Campaign. Register a Ramadan Forex Live Trading Account now and get a 300% Ramadan Welcome Bonus Campaign for deposits starting from $100 Link:  300% Ramadan Bonus Campaign Link:  $123 Forex No Deposit Bonus Link:  100% Deposit Bonus Promotion Available to: All new traders Ending Date: 31 December 2018 Bonus Offer:

$100 Binary Options No Deposit Bonus Contest – AYREX

$100 Binary Options No Deposit Bonus Contest – AYREX(0)

$100 Free Binary Options No Deposit Bonus Contest is a competition open to all AYREX account holders via demo accounts created automatically upon registration and used solely for contest participation Link:  $100 Free Win in Just One Hour Link:  $30 Binary Options No Deposit Bonus Link:  30% Binary Options Deposit Bonus Contest Ending Date: 31

$50 Free Bonus Promotion Start Trading Bitcoin – UFX

$50 Free Bonus Promotion Start Trading Bitcoin – UFX(0)

Get a $50 Free Bonus Promotion Start Trading Bitcoin with UFX. Forex Trading Bitcoin with UFX is simple and gives you the opportunity to increase your return whether BTC prices RISE or FALL Link:  $50 Free and Trade in Three Steps Link:  $50 Free No Deposit Bitcoin Bonus Link:  100% Real Money CashBack Promotion Available

30% Binary Options Welcome Bonus up to $1000 – Ayrex

30% Binary Options Welcome Bonus up to $1000 – Ayrex(0)

30% Binary Options Deposit Bonus Up to $1000 to all new Traders. Welcome Bonus can be applied to a deposit that equals 100 EUR/USD or a larger amount Link:  $100 Free Win in Just One Hour Link:  $30 Binary Options No Deposit Bonus Link:  30% Binary Options Deposit Bonus Ending Date: 31 December 2018 Bonus

Up to 200% Bonus Forex and Binary Options – Grand Capital

Up to 200% Bonus Forex and Binary Options – Grand Capital(0)

Up to 200% Bonus Forex and Binary Options Promotion to your Deposit to All clients. The Bonus Promo size ranges from 60% to 200%, depending on the account type, deposit amount and the term of trading with Grand Capital. Link:  Up to 200% Bonus to your Deposit Link: Up to 444% Profit Receive for a

$15 Cashback Rebate Bonus per Lot Traded – FBS

$15 Cashback Rebate Bonus per Lot Traded – FBS(0)

Get $15 Cash back Rebate Bonus per Lot Traded to All new traders. $15 Cashback Rebate Bonus service is unavailable for the clients, who registered their accounts via their partners. Link:  $123 Free Special Bonus Promotion Link:  100% Deposit Bonus Promotion Link:  $88.8 Lucky No Deposit Required Bonus (for Malaysian traders) Available to: All new

100% Cashback Loyalty Bonus & $50 Free Bonus – UFX

100% Cashback Loyalty Bonus & $50 Free Bonus – UFX(0)

UFX 100% Rewards Cashback Loyalty Programme and $50 Forex No Deposit Bonus Special Bonus to All new and existing accounts. Learn about Forex trading bonus promotion Link:  $50 Free and Trade in Three Steps Link:  100% Rewards Cashback Loyalty Promo Link:  $50 Free No Deposit Bitcoin Bonus Available to: All new trading account Ending Date:

Free Trading Signals and Forex Free E-books – Trade12

Free Trading Signals and Forex Free E-books – Trade12(0)

Get 100% Forex Deposit Bonus and Free Forex Daily Trading Signals, Forex Free E-books, Boost your trading with a free 100% Welcome Deposit Bonus to your Live Trading Account. Link:  Free Daily Forex Trading Signals Link:  Get 100% Welcome Deposit Bonus Link:  50% Exclusive Deposit Bonus Link:  Free Trader Education and Free Ebooks Link:  Free

read more

Forex Featured Broker

Contacts and information

ForexDepositNews.com Forex Deposit Bonus, Forex No Deposit Bonus, Forex Live Contest, Forex Demo Contest, Free Forex Bonus Forex Brokers Review and Other All Forex promotions.

ForexDepositNews.com

Social networks

Most popular categories