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A collection of positive and negative news that affects the foreign exchange market
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Hello everyone, today XM Foreign Exchange will bring you "【XM Group】: Collection of positive and negative news that affects the foreign exchange market". Hope it will be helpful to you! The original content is as follows:
At a time when the global economy is becoming increasingly interdependent, the foreign exchange market is affected by many factors, and the market is changing rapidly. For investors, accurately grasping the positive and negative news of daily positive news is the key to formulating a reasonable investment strategy. The following is a review of important news that affects the foreign exchange market on July 17, 2025.
1. Good news
(I) Economic data level
Some emerging economies have performed well. For example, Brazil has seen its recent industrial output data exceed expectations, reflecting the strong recovery momentum of the country's industrial sector. This has enhanced the market's confidence in Brazil's economic prospects, and thus promoted the appreciation of Brazil's real relative to some currencies in the foreign exchange market, such as the exchange rate against the offshore RMB to rise to a certain extent. Similarly, Australia's June employment data was better than expected, with unemployment falling to its lows in recent years, and the boom in the job market often heralds a good economy and providing strong support for the Australian dollar. In foreign exchange trading on that day, the Australian dollar rose to varying degrees against currencies such as Chilean peso and Japanese yen.
(II) Capital flow level
Foreign capital continues to flow into the capital markets of some countries. According to data from the State Administration of Foreign Exchange, foreign capital increased its holdings of domestic stocks in May further than last month. This inflow of funds not only reflects international investors' optimism about the country's economic outlook, but also increases demand for the country's currency. Taking the RMB as an example, as foreign capital continues to buy Chinese stocks, the demand for RMB in the foreign exchange market has increased, promoting the stability of the RMB exchange rate and even showing an appreciation trend for some currencies. In addition, from a global perspective, due to the many uncertainties between the US economy and the US dollar,Kim is seeking safer and more promising investment destinations, and some currencies of countries with stable economic and favorable policies benefit from it.
(III) At the trend of currency diversification
The global currency diversification development has accelerated, which poses long-term benefits to non-US currencies. According to data from the International Monetary Fund, the proportion of the US dollar in global foreign exchange reserves further dropped to 57.7% in the first quarter of this year. At the same time, the position of currencies such as the euro and the RMB in global payments and reserves has gradually improved. For example, in Europe, with the gradual recovery of the economy and the stable advancement of policies, the euro's attractiveness in trade settlement and foreign exchange reserves has increased, prompting the euro to perform relatively strongly in the foreign exchange market, with a significant cumulative increase in the first half of 2025. This trend of currency diversification has made investors more inclined to hold multiple currencies in asset allocation, reducing excessive dependence on the US dollar, and providing broad space for the development of non-US currencies.
2. Negative news
(I) The US economic and policy level
The US economic stagflation dilemma is difficult to resolve, and the risk of fiscal policy being out of control has increased, which puts heavy pressure on the US dollar. Since the beginning of this year, the US economic growth has slowed down and inflation has rebounded significantly. The GDP in the first quarter shrank by 0.5% on an annualized basis on a month-on-month basis, and the annualized quarterly rate of the core PCE price index was 3.5%. In addition, the US Congressional Budget Office said that the Senate version of the "Big and US" bill will increase US $3.3 trillion in debt in the next 10 years. It is expected that in July 2025, the total US federal debt will exceed US $37 trillion, accounting for 123% of its GDP. Economic instability and deterioration in fiscal conditions have seriously weakened market confidence in the US dollar. In the foreign exchange market, the US dollar index fell continuously in the first half of this year, with a drop of nearly 11%, the largest drop in the same period since 1973. This downward trend causes the dollar to perform poorly when exchanging other currencies, such as the dollar falling against currencies such as the Argentine peso and Bulgarian Lev.
(II) Geopolitical and trade friction level
Geopolitical conflicts and trade frictions continue to escalate, disrupting the global economic order and affecting the stability of the foreign exchange market. Tensions in some regions have caused fluctuations in energy prices, which in turn affects the currencies of relevant countries. If the situation in the Middle East is tense, if crude oil supply is blocked, countries that rely on crude oil imports will be affected and their currencies will face pressure to depreciate. At the same time, trade frictions have caused global trade volume to decline, economic growth in some export-oriented countries has been suppressed, and currency exchange rates have fallen. For example, the trade dispute between two countries has caused difficulties in the operation of import and export enterprises between the two sides, and the currencies of relevant countries have performed weakly in the foreign exchange market, and the currency exchange rate has declined.
(III) Foreign exchange hedging demand level
The increase in foreign exchange hedging demand is not good for the US dollar. After the 2008 financial crisis, global investors accumulated a large amount of US dollar exposure in the U.S. market. Recently, international stock markets outside the United States have performed strongly, coupled with Trump's tradeThe uncertainty of the agenda prompts investors to change their strategies and increase foreign exchange hedging demand. This change in demand has become one of the key drivers of the dollar's weakening in the first half of the year and is expected to continue to affect the dollar exchange rate. For example, when foreign investors hold US dollar positions, they choose hedging to avoid risks, resulting in increased selling pressure on the US dollar in the foreign exchange market, which in turn drives the US dollar to lower the exchange rate against other currencies.
The foreign exchange market is affected by the interweaving of multiple xm-links.complex factors, and good news and bad news are playing against each other. During the transaction process, investors need to pay close attention to global economic trends, policy changes and geopolitical situations, xm-links.comprehensively analyze various news, and make investment decisions prudently to cope with the changes in the foreign exchange market.
The above content is all about "【XM Group】: Collection of Positive and Negative News that Influences the Foreign Exchange Market". It was carefully xm-links.compiled and edited by the XM Foreign Exchange editor. I hope it will be helpful to your trading! Thanks for the support!
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