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A collection of positive and negative news that affects the foreign exchange market
Wonderful Introduction:
The moon has phases, people have joys and sorrows, whether life has changes, the year has four seasons, after the long night, you can see dawn, suffer pain, you can have happiness, endure the cold winter, you don’t need to lie down, and after all the cold plums, you can look forward to the New Year.
Hello everyone, today XM Foreign Exchange will bring you "【XM Foreign Exchange Platform】: 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:
In the xm-links.complex chess game in the foreign exchange market, each piece of news is like a key piece, affecting the trend of the currency pair. On July 23, many factors were intertwined, shaping the pattern of the foreign exchange market. Investors need to pay close attention to these positive and negative news in order to make wise decisions.
1. Good news
(I) my country's foreign exchange market is resilient, and the trend of foreign capital increasing allocation of RMB assets is improving. The State Administration of Foreign Exchange sends a positive signal: On July 22, the State Information Office held a press conference to introduce the foreign exchange receipts and expenditure data in the first half of 2025. Li Bin, deputy director and spokesperson of the State Administration of Foreign Exchange, said that my country's high-quality economic development, steady progress of opening up to the outside world, and the resilience of the foreign exchange market continues to increase. These three factors support the stable operation of the foreign exchange market, and the RMB exchange rate is expected to remain basically stable at a reasonable and balanced level. In the first half of the year, the GDP grew by 5.3% year-on-year, the economic structure continued to be optimized, and the contribution of domestic demand to economic growth increased significantly. The prudent economy is manifested in the stability of the foreign exchange market and strengthening international investors' confidence in RMB assets.
Foreign capital increases its holdings of domestic stocks and funds reverses: Jia Ning, director of the Balance of Payments Department of the State Administration of Foreign Exchange, pointed out that foreign capital allocates RMB assets since this year, and the scale of investment in RMB bonds has increased. The total amount of domestic RMB bonds held by foreign capital exceeds US$600 billion, at a historical high. In the first half of the year, foreign capital increased its holdings of domestic stocks and funds by US$10.1 billion, reversing the overall net reduction in holdings in the past two years. The net increase in holdings in May and June reached US$18.8 billion. This shows that global capital allocation is increasing in domestic stock markets. In addition, the latest official forum of international monetary and financial institutionsThe survey results of 75 central banks around the world show that 30% of central banks said they would increase their allocation of RMB assets, further indicating that the attractiveness of RMB assets has increased and provided potential support for the RMB exchange rate.
Foreign exchange market transactions are active, and the proportion of RMB cross-border revenue and expenditure increased: in the first half of the year, the cross-border revenue and expenditure of non-bank sectors such as enterprises and individuals totaled US$7.6 trillion, an increase of 10.4% year-on-year, setting a record high in the same period. The proportion of RMB in cross-border revenue and expenditure reached 53%. The total scale of bank foreign exchange settlement and foreign exchange sales was US$2.3 trillion, an increase of 3% year-on-year, the highest in the same period in history. The total trading volume of the domestic RMB foreign exchange market was US$21 trillion, an increase of 10.2% year-on-year. Active foreign exchange market transactions reflect the positive attitude of market participants towards RMB assets, and the increase in the proportion of RMB cross-border revenue and expenditure also indirectly reflects the gradual increase in the position of RMB in international payment and settlement, which is conducive to the stable performance of RMB in the foreign exchange market.
(II) Exchange rates of some currency pairs rose
Forex trading data on July 23 showed that some currency pairs showed an upward trend in exchange rates. For example, the Euro-Albanian Lek exchange rate rose and fell by 0.36, the Euro-Colombian peso rose and fell by 9.07, and the Eritrea Nakfa vs. Japanese yen rose and fell by 0.07067, etc. The rise in these currency pairs is good news for investors holding long positions in the corresponding currency. It may be driven by factors such as improvement in economic data in relevant countries, favorable policies or changes in market sentiment, and affect the flow of funds in the foreign exchange market and the trading decisions of investors.
2. Negative news
(I) Uncertainty in global economic growth is increasing, and trade frictions are shrouded in the clouds
European and the United States trade frictions continue to escalate. The United States plans to take effect on tariff policies on August 1, and the European Union is preparing to counter US goods of 21 billion euros. This seriously affects the global economic growth prospects, and the International Monetary Fund (IMF) has recently lowered its economic growth expectations in some countries. The slowdown in global economic growth will curb international trade and investment activities and reduce foreign exchange market trading activity. For national currencies that rely on imports and exports, slowing economic growth may lead to an expansion of trade deficits and outflow of funds, which put downward pressure on the currency exchange rate. For example, emerging market currencies may face the risk of depreciation due to weakening external demand and returning funds to developed countries, which will be reflected in the downward trend of relevant currency pairs in the foreign exchange market.
(II) The fluctuations in the international financial market are increasing
At present, the international political situation is xm-links.complex and changeable, and geopolitical conflicts occur from time to time. In addition, the global economic recovery process has led to increased fluctuations in the international financial market. Large fluctuations in the stock market and bond markets will cause investors to experience a rise in risk aversion, and funds often flow to traditional safe-haven currencies, such as the US dollar, the yen, the Swiss franc, etc. This will cause other currencies to depreciate relatively and disrupt the normal exchange rate fluctuation rhythm of the foreign exchange market. For example, when geopolitical tensions escalate in a certain region, investors will sell risk assets and buy safe-haven currencies, causing a sharp drop in the region's currency against safe-haven currencies., affecting the overall stability of the foreign exchange market and investor expectations.
(III) The monetary policy outlook for some central banks is unclear
There is uncertainty in the direction of monetary policy of some central banks around the world. Some countries are facing inflationary pressure, but insufficient momentum for economic growth has caused the central bank to face a dilemma in monetary policy decisions. If the central bank maintains loose monetary policy to stimulate the economy, it may trigger a further increase in inflation, weaken the purchasing power of the currency, and lead to currency depreciation; if monetary policy is tightened to curb inflation, it may hinder economic recovery, which is also unfavorable to the currency. For example, a central bank of a certain country did not provide clear guidance on the future policy direction at its monetary policy meeting in July. The market's expectations for its monetary policy are chaotic, which triggered the country's currency to intensify its volatility in the foreign exchange market. Investors reduced their holdings of the currency due to uncertainty and turned to monetary assets with clearer policy prospects.
Total view, on July 23, the foreign exchange market moved forward in a game of many positive and negative news. Investors need to closely track the release of economic data, central bank policy dynamics and changes in the international political situation, xm-links.comprehensively analyze the impact of news on different currencies, carefully formulate investment strategies, and seize opportunities and avoid risks in the xm-links.complex and changeable foreign exchange market.
The above content is all about "【XM Foreign Exchange Platform】: Collection of positive and negative news that affects 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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