This week, the global financial markets continued to stabilize following weeks of increased turmoil. Here are some of the most important updates of the week.
This week, the cryptocurrencies market started positively. On Tuesday, the currencies reached a weekly high with bitcoin reaching a high of $11,797.
Since then, the currencies started going down with bitcoin reaching its weekly low on Thursday when it reached $9,574.
The downward movements happened as traders took profits following a multi-week rally that started a two weeks ago. Since then, the currencies have risen by more than 50%.
The positive news came from South Korea which moved from threats to embracing the currencies.
This week, we received multiple words from key central bankers. On Tuesday, we received minutes from the Royal Bank of New Zealand’s last meeting. The minutes showed that while the members were optimistic about the economy and the hegemony of the global economy, they remained highly concerned about the ballooning mortgage debt. Week-to-date, the AUD is lower 1.50% against the dollar.
On Wednesday, the BOE held the inflation hearings where the members reaffirmed their past statements about hiking rates if inflation continues to rise. The pound is low by 0.44% against the dollar.
The global stocks were significantly down this week as traders started questioning the long-term prospects. As of this writing, the Dow and S&P are down 0.94%, 1%, while the DAX and Nikkei were up 1.31% and 1.26% respectively. In the United States, the biggest stocks gainers were Home Depot, Exxon Mobil, and United Health, which gained by 1.32%, 1.30%, and 0.87% respectively.
The dollar index was up by 1.41%. The upward momentum for the dollar came as investors forecasted that the Fed was likely to raise interest rates. This came after the Fed released the minutes for their latest FOMC meeting. The minutes showed that the Fed officials were optimistic about the economy, which they believe will be boosted by the tax cuts. Against the Euro, Yen, and Pound, the dollar was up by 0.77%, 0.40%, and 0.31% respectively.
The Canadian dollar continued its multi-month decline, falling to a low of 1.2742. The Australian dollar was also down by 1.50% against the dollar.
Gold was up marginally this week. It started the week by reaching a high of $1,349 before losing those gains to currently trade at 1,333. The downward trend came as the dollar strength intensified and as the volatility started to come down. Its poor cousin, silver fell by 0.72% while platinum and palladium fell by 1.51% and 0.35% respectively.
In the crude oil markets, the crude oil continued its upward momentum with the Brent rising by more than 2% and WTI by 1.62%. The upward momentum continued as the EIA data showed reduced stockpiles in the US. The data showed that stockpiles fell by 1.6 million barrels to reach 420.8 million barrels. The data showed that oil production was unchanged to 10.2 million barrels per day.
In the coming week, traders will focus on manufacturing data from China, employment data from Germany, inflation data from European Union, US GDP growth, and manufacturing data from the US.