The USD is the strongest and the NZD is the weakest as the NA session begins | Forexlive

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The strongest to weakest of the major currencies

The strongest currency is the US dollar while the weakest of the NZD as North American traders enter for the day. It’s Friday. TGIF. Market activity can be more volatile at the end of the week going into the weekend when the markets are closed.

Russia cut the rates by 300 basis points to 17% is the economy shifts from fears of  inflation 
Inflation

Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is measured by the level of the total money supply of a specific currency, for example the US dollar, which is constantly increasing. However, an increase in the money supply does not necessarily mean that there is inflation. What leads to inflation is a faster increase in the money supply in relation to the wealth produced (measured with GDP). As such, this generates pressure of demand on a supply that does not increase at the same rate. The consumer price index then increases, generating inflation.How Does Inflation Affect Forex?The level of inflation has a direct impact on the exchange rate between two currencies on several levels.This includes purchasing power parity, which attempts to compare different purchasing powers of each country according to the general price level. In doing so, this makes it possible to determine the country with the most expensive cost of living.The currency with the higher inflation rate consequently loses value and depreciates, while the currency with the lower inflation rate appreciates on the forex market.Interest rates are also impacted. Inflation rates that are too high push interest rates up, which has the effect of depreciating the currency on foreign exchange. Conversely, inflation that is too low (or deflation) pushes interest rates down, which has the effect of appreciating the currency on the forex market.

Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is measured by the level of the total money supply of a specific currency, for example the US dollar, which is constantly increasing. However, an increase in the money supply does not necessarily mean that there is inflation. What leads to inflation is a faster increase in the money supply in relation to the wealth produced (measured with GDP). As such, this generates pressure of demand on a supply that does not increase at the same rate. The consumer price index then increases, generating inflation.How Does Inflation Affect Forex?The level of inflation has a direct impact on the exchange rate between two currencies on several levels.This includes purchasing power parity, which attempts to compare different purchasing powers of each country according to the general price level. In doing so, this makes it possible to determine the country with the most expensive cost of living.The currency with the higher inflation rate consequently loses value and depreciates, while the currency with the lower inflation rate appreciates on the forex market.Interest rates are also impacted. Inflation rates that are too high push interest rates up, which has the effect of depreciating the currency on foreign exchange. Conversely, inflation that is too low (or deflation) pushes interest rates down, which has the effect of appreciating the currency on the forex market.
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to economic recession and financial stability. In Ukraine, Russian forces bombed civilians at a train station killing over 30 people. The pressure from global sanctions continued to escalate yesterday with the EU banning the import of Russian coal. They continue to refrain from bans on Russian oil with Germany firmly against that idea for fears of an immediate recession if enacted.

Stocks are higher in premarket trading after yesterday’s gains snapped a two day losing streak. US yields are higher with the 10 year continued to push toward the 3.0% level. The 10 year yield trades at three year highs. I don’t know if it’s good news, but the two – 10 year spread as moved from inverted (a prelude to a recession) to positive this week. The current spread is around 16 basis points after closing near 19 basis point yesterday. The spread moved to around -9 basis points at the most inverted level.

The first round of presidential elections in France is projected to advance Pres. Macron and right wing, anti EU populist Le Pen who he is advocating for greater state intervention to help in the rise in inflation. The next round would be in 2 weeks time. Polls have narrowed markedly as rising inflation are weighing on Macron’s popularity.

Canada will release their jobs report at 8:30 AM ET. with expectations of a gain of 80K after last months 336.6K surge. US wholesale inventory data will be released at 10 AM along with weekly Baker Hughes oil rig data later this afternoon.

A snapshot of the markets as North American traders enter for the day shows:

  • Spot gold is trading up $3.30 or 0.16% $1934
  • Spot silver is trading up two cents or 0.13% at $24.61
  • Spot crude oil is trading up $0.37 or 0.39% at $96.40
  • Bitcoin is trading near unchanged at $43,350

The major US stock indices snapped a 2 day down day yesterday and are trading higher in premarket activity.

  • Dow industrial average up 134.43 points after yesterday’s 87.06 point gain
  • S&P index up up 16 points after yesterday’s 19.04 point gain
  • Nasdaq index is 8.48 points after yesterday’s 8.48 point gain

In the European equity markets, the major indices are also rebounding for the 2nd consecutive day..

  • German DAX, up 1.5%
  • France’s CAC, up 1.5%
  • UK’s FTSE 100 up 1.0%
  • Spain’s Ibex, up 1.8%
  • Italy’s FTSE MIB up 2.0%

In the US debt market, the yields are higher, with a flatter  yield curve 
Yield Curve

A yield curve is a line used to help determine interest rates of interest rates for a specific bond, differentiated by contract lengths. This is useful for contrasting maturity dates, for example 1 month, 1 year, etc.In particular, yield curves help underscore the relationship between interest rates or borrowing costs and the time to maturity.Some of the best examples of this include US Treasury Securities, which are among some of the most observed worldwide by traders. By determining the slope of yield curves, it is possible to plot or predict future interest rate changes. There are three types of yield curves that are primarily studied, classified as normal, inverted, or flat.Why are Yield Curves Important?Yield curves like other benchmarks help investors and analysts ascertain more information about specific constructs affecting financial markets.For example, a normal or upward sloping curve points to economic expansion. Expectations of yields becoming higher in the future help attract funds in shorter-term securities with the hopes of purchasing longer-term bonds later, for a higher yield.The opposite is true in the case of an inverted or downward sloping curve, which traditionally points to an economic recession. If yields are expected to eventually be lower, investors opt to purchase longer-term bonds to help price in yields before further decreases occur.Subsequently, these are predictive of economic output and growth and are thus instrumental in financial analysis.These curves are also utilized primarily as a barometer for other forms of debt in a market, including bank lending rates, mortgage rates, and other benchmarks.The most reported yield curves deal with US Treasury debt, comparing the 3-month, 2-year, 5-year, 10-year and 30-year intervals. This information is published daily.

A yield curve is a line used to help determine interest rates of interest rates for a specific bond, differentiated by contract lengths. This is useful for contrasting maturity dates, for example 1 month, 1 year, etc.In particular, yield curves help underscore the relationship between interest rates or borrowing costs and the time to maturity.Some of the best examples of this include US Treasury Securities, which are among some of the most observed worldwide by traders. By determining the slope of yield curves, it is possible to plot or predict future interest rate changes. There are three types of yield curves that are primarily studied, classified as normal, inverted, or flat.Why are Yield Curves Important?Yield curves like other benchmarks help investors and analysts ascertain more information about specific constructs affecting financial markets.For example, a normal or upward sloping curve points to economic expansion. Expectations of yields becoming higher in the future help attract funds in shorter-term securities with the hopes of purchasing longer-term bonds later, for a higher yield.The opposite is true in the case of an inverted or downward sloping curve, which traditionally points to an economic recession. If yields are expected to eventually be lower, investors opt to purchase longer-term bonds to help price in yields before further decreases occur.Subsequently, these are predictive of economic output and growth and are thus instrumental in financial analysis.These curves are also utilized primarily as a barometer for other forms of debt in a market, including bank lending rates, mortgage rates, and other benchmarks.The most reported yield curves deal with US Treasury debt, comparing the 3-month, 2-year, 5-year, 10-year and 30-year intervals. This information is published daily.
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. Talk of 3% 10 year yield becoming part of the projections as job market continues to be tight, tight, tight, and housing market is too high.

Yields
US yields are higher

European 10 year yields are also higher at the start of the North American session:

Europe
European benchmark 10 year rates are higher

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