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Exchange4free Global Forex Report (24/01/2018)


The U.S Dollar has been volatile in the foreign exchange market, with the Dollar Index falling to a fresh 3 year low on Monday. On Tuesday, Brown Brothers Harriman (BBH) has noted that the Greenback has been marked lower since last month.

The weakening of the Dollar is mainly due to rising inflation expectations and greater convictions that the Fed will continue to hike interest rates. The EUR/USD pair traded at 1.22 on Monday and is currently trading around 1.23398.

Speculators believe that the latest round of US data failed to offer support to the already weakened Dollar and that politics and policies could further weaken the Dollar throughout 2018.


On Tuesday, the EUR/USD pair was trading at 1.2290, up 0.25% on the day. The pair has been reaching new highs over the last weeks and it looks like the pair is on its way to 1.30. Currently the pair is trading at 1.23098.

Spectators believe that the positive politics in Germany, increased investments and bullish consumers in the Eurozone are some of the contributing factors of the continuous climb in the pair.

Analysts from Australia and New Zealand Banking Group (ANZ), have forecasted that the EUR/ USD pair could reach 1.30 and that it will be driven by inflation dynamics, better economic growth and improving political developments.


The Sterling achieved a significant milestone on Tuesday, when it reached a high of 1.4028 against the U.S Dollar for the first time since 2016.

The climb in the pair was the result of stronger manufacturing data, the weakness of the U.S Dollar and triggering stops placed above the 1.40 mark. The pair lost some ground during Asian trading hours, falling to 1.3915, before recovering to 1.3950. Currently the Sterling is trading at 1.4028 against the Dollar.

Despite Brexit negotiations, the British economy is performing well. Key employment numbers will be released later today and markets are expecting solid readings for unemployment and wage growth. Should these productions prove accurate, it could push the Sterling even higher.


At the end of Tuesday’s session, the Australian Dollar closed above 0.80 against the U.S Dollar. The pair exceeded market expectations and reached its highest close since September 2017.

The U.S Dollar weakness and the unresponsiveness of the U.S Dollar to firming yield spreads, are the predominant reasons for the climb in the AUD/USD pair. Currently the pair is trading at 0.80265.


The Swiss Franc lost some ground on Monday as the pound advanced against major currencies after a positive Brexit forecast and it showed mixed movements against its peers. The GBP/ CHF pair was trading at 1.33432 on Monday, compared to 1.33466 on Friday.

The GBP/CHF pair is currently trading around 1.33915, compared to 1.3281 from last week.

There are no major economic events in this region this week, however, the Swiss National Bank Chairman, Thomas Jordan, has announced that higher interest rates are not likely in the near term and that Swiss inflation still remains below 2%.


Today, the Rand has been at its highest level against the US Dollar since June 2015 trading below 12. This is a result of a weaker Dollar and speculation of President Jacob Zuma stepping down in the near future. It was, however, announced earlier today that Zuma will be delivering the State of Nation Address (SONA) on 8 February.

It is clear that investors have become more optimistic about the Rand with Cyril Ramaphosa next in line to be the President of South Africa. It is also said that the presidency shift should avoid further credit downgrades for the country.

According to data released by Statistics South Africa today, Consumer price inflation for the year 2017 remained within the target band of 3% to 6% with the average being 5.3% for the year. This is 1.1% lower than the year 2016 which had an average of 6.4%.


Yesterday, Olusegun Obasanjo, former president of Nigeria called on President Muhammadu Buhari to not seek for re-election. Obasanjo argued that as the country is in an economic slump and is more divided and insecure than before, it would be risky to vote Buhari in as President for the next 4 years. After spending most of last year in London receiving treatment for an unspecified illness, have left many wondering if he is fit enough to lead the country for another term. Aisha, Buhari’s wife, has indicated that she will not support him if he seeks to be re- elected for a second term.

We have seen the NGN weaken over the past couple of days against the majors, USD/NGN 364, GBP/NGN 497 and EUR/NGN 437.

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