ONLINE FOREX BROKER
2020-12-08 • Updated
USD/ZAR dropped to the low levels unseen since February as investors foresee the soon global recovery.
Some countries such as the UK started massive vaccinations, while others are already in the final steps. Therefore, investors streamed their capital to riskier assets like emerging market currencies on prospects for a global economic recovery. Indeed, the virus will be taken under control soon and the world economy will be boosted. According to Credit Suisse, “EM [emerging market] also looks well positioned to outperform whether there is a value- or growth-driven rally in 2021”.
It was necessary to impose record low interest rates in the world’s largest economies to stimulate economic activity. These countries won’t increase rates anytime soon. Whereas emerging markets have significantly higher rates and therefore higher yields. That’s why it’s beneficial to invest money in emerging markets.
USD/ZAR fell due to the optimistic vaccine news and the weak US dollar. Elsewhere, South Africa’s GDP recovered by 66.1% in the third quarter, showing the steady economic rebound of the country. However, it is still far away from the pre-pandemic levels.
Traders should closely observe this pair now as it has approached the key support of 15.0000. The price isn’t likely to break this level for the first attempt and we might see the retracement. If it manages to cross this level, the way down to February lows of 14.7250 will be clear. On the flip side, the move above the 50-period moving average of 15.2500 will drive the pair to the high of November 30 at 15.4500.
Oil prices rebounded slightly on Friday but are still expected to show losses for the week due to concerns about slowing growth in the US and China. US crude futures rose 2.7% to $70.41 per barrel, while the Brent contract increased by 2.5% to $74.33 per barrel.
China's economy is rocketing. On the other hand OPEC+ countries take the decision to cut the production. What will be the impact on the oil price?
The past two years have seen the biggest swings in oil prices in 14 years, which have baffled markets, investors, and traders due to geopolitical tensions and the shift towards clean energy.
Let's dive into the latest developments shaping the global economic landscape. Good news first: the threat of an unprecedented US debt crisis has receded, as US lawmakers passed a bill to raise the debt ceiling and avoid a catastrophic default. Phew! But don't pop the champagne just yet, because storm clouds are still looming. High inflation, rising interest rates, and sluggish growth are challenges that have yet to disappear.
Thanks to the incredible advancements in horizontal drilling and fracking technology, the United States has experienced a mind-blowing shale revolution. They've become the heavyweight champion of crude oil production, leaving Saudi Arabia and Russia in the dust. They even turned the tables and became net exporters of refined petroleum products in 2011.
Let's dive into the world of gold. Currently, the price of gold, represented by XAUUSD, is stuck in indecision, hovering around the $1,975 mark. The market is anxiously awaiting two important factors: the release of the Federal Reserve's meeting minutes and the extension of the US debt ceiling.
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