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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 Official Website】: 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 foreign exchange market, various news always affects the trend of the currency, and investors need to pay close attention to the latest developments in order to make informed decisions. On July 15, many news fermented in the market. The following is a review of the positive and negative news that affected the foreign exchange market on that day.
1. Good news
(I) The People's Bank of China has a clear attitude towards maintaining exchange rate stability
Zou Lan, deputy governor of the People's Bank of China, said at a press conference of the State Information Office on July 14 that China does not seek to gain international www.xmhouses.competitive advantages through exchange rate depreciation. The People's Bank of China will continue to adhere to the decisive role of the market in exchange rate formation, maintain exchange rate elasticity, and at the same time strengthen expectations guidance, prevent the risk of exchange rate overshooting, and maintain the basic stability of the RMB exchange rate at a reasonable equilibrium level. This statement stabilized the market's expectations for the RMB exchange rate and enhanced investors' confidence in RMB assets. Against the backdrop of intensifying global currency exchange rate fluctuations, the People's Bank of China's clear and consistent exchange rate policy stance provides strong support for the smooth operation of the RMB in the foreign exchange market, helping to attract more international funds to flow into the Chinese market, and forming a positive for the RMB exchange rate.
(II) The State Administration of Foreign Exchange will introduce facilitation policies
At a press conference held by the State Council Information Office on the 14th, Li Bin, deputy director and spokesperson of the State Administration of Foreign Exchange, said that more foreign exchange facilitation policies will be introduced in 2025. Continue to promote the policy of facilitating foreign exchange income and expenditure of high-quality enterprises, promote it to small-scale regions and small and medium-sized banks, and benefit more high-quality small and medium-sized enterprises. In www.xmhouses.combination with the characteristics of new trade formats, support the return of export payments and simplify foreign exchange payment procedures. At the same time, respond to the demands of contracting engineering www.xmhouses.companies and support the unified management and independent allocation of engineering project funds. These policies aim to enhance foreign exchange capitalThe facilitation level of gold settlement reduces corporate transaction costs and promotes trade and investment activity. The implementation of policies is expected to enhance the market's attractiveness to RMB assets and create long-term benefits for RMB exchange rate and related foreign exchange transactions.
(III) Bank of America predicts that the dollar will decline in the second half of the year will be limited
In the first half of this year, the dollar suffered its worst performance in the first half of the year since 1973. However, Bank of America analysis shows that the dollar may have limited room for decline in the second half of the year. Judging from the time zone framework, if the Federal Reserve keeps interest rates unchanged for the rest of the year, it will moderately support the US dollar during the US trading period. During the Asian session, Asian investors were previously the main dollar sellers, but their selling momentum may weaken as the cumulative long-term return on the sell-off dollar fell to neutral levels. Although the US dollar still has room for depreciation during the European trading period, this requires global stock markets to outperform the US stock market for the rest of the year. This analysis report has eased the market's concerns about the continued sharp depreciation of the US dollar to a certain extent, and has brought relatively optimistic expectations for investors who hold US dollar assets or involve US dollar trading, which has provided potential positive support for the short-term performance of the US dollar in the foreign exchange market.
2. Bad news
(I) The US dollar performed poorly in the first half of the year and still faced pressure in the second half of the year. In the first half of 2025, the US dollar index fell by nearly 11%, the largest drop in the index in the first half of the year since the Nixon era in 1973. Brad Bechtel, global foreign exchange director of Jefferies Group, pointed out that the US dollar faces three negative factors: increased foreign exchange hedging demand, the Federal Reserve's interest rate cut, and the de facto weak US dollar policy. Global investors have accumulated a large amount of US dollar exposure due to the strong strength of the US stock market and the US dollar in the early stage. Now, with the differentiation of international stock market performance and the uncertainty of Trump's trade agenda, foreign exchange hedging demand has increased sharply, becoming one of the key drivers of the dollar's weakening in the first half of the year, and this trend is expected to continue. At the same time, the market generally expects the Federal Reserve to cut interest rates as early as September. Given the Fed's interest rate cut space www.xmhouses.compared to other major central banks around the world, its interest rate cut operations may further suppress the US dollar. In addition, relevant policies of the US government are considered to have a tendency to promote a weak dollar to enhance the www.xmhouses.competitiveness of US export www.xmhouses.commodities, which also puts pressure on the long-term trend of the US dollar. (II) The exchange rate of RMB against some currencies fell
On July 15, the exchange rate of RMB against some currencies showed a downward trend. For example, the percentage of the RMB exchange rate rise and fall against Costa Rican Colon was -0.1855%, the Libyan dinar was -0.2386%, and the Botswanan Pula fell sharply, etc. Although the overall exchange rate of the RMB remains at a reasonable equilibrium level under the guidance of the central bank's policies, the downward trend of some currencies reflects the www.xmhouses.complex fluctuations in the currency exchange rate in the foreign exchange market. For investors who hold these currency assets or have related transaction needs, the depreciation of the RMB relative to these currencies may increase its transaction costs or asset impairment risks, forming a related foreign exchange transactionAdverse effects.
The foreign exchange market is full of uncertainty under the influence of the interweaving of various positive and negative news. Investors need to www.xmhouses.comprehensively consider various types of information, www.xmhouses.combine their own risk tolerance and investment goals, and carefully formulate foreign exchange trading strategies.
The above content is all about "【XM official website】: Collection of positive and negative news that affects the foreign exchange market". It was carefully www.xmhouses.compiled and edited by the XM Forex editor. I hope it will be helpful to your trading! Thanks for the support!
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