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International Financial Information

International Financial Information

[Algerian Minister of Energy: OPEC + Joint Technical Committee Proposes Extension of Current Crude Oil Supply Production Reduction Plan to End 2020]
Algerian Minister of Energy: OPEC + Joint Technical Committee proposes to extend the current crude oil supply production reduction plan until the end of 2020. The OPEC + Joint Technical Committee recommends further reductions in crude oil production before the end of the second quarter of 2020. It will continue to work with OPEC and non-OPEC OPEC measures to seek a "consensus solution" to quickly stabilize the crude oil market and respond to the crisis.

[Source said that Saudi Arabia and Kuwait plan to restart trial production of 10,000 barrels / day of crude oil in the neutral zone]

[According to official media reports, due to pollution and gas leakage, Iraq ’s Basra Crude Oil Company will reduce crude oil production at the Nahr Bin Omar oil field to a minimum level]

[At least 25 people killed in Thai shooting]
On the 8th, soldier shootings in Nakhon Ratchasima, northeastern Thailand, have killed 25 people and injured 34. The number of casualties may rise further. There are still people trapped in the mall where the gunmen are hiding, and special forces are preparing to launch a general attack. The police initially believed that the soldier had committed personal land disputes with the officer, shot the officer, and then snatched the bullets from the barracks. He drove into the city center and committed the crime again.

[Ireland holds general elections on 8th; multiple polls show that the ruling party, the United Party, led by current Prime Minister Valadka, faces severe challenges from the two opposition parties, namely the Republican Party and Sinn Fein]

[Facebook and Messenger official Twitter accounts confirmed to be hacked]

Twitter confirmed on Friday that the official Twitter accounts of social media giant Facebook and its Messenger platform were hacked; a Twitter spokesman said in a statement that the accounts had been hacked through a third-party platform.


Summary of Institutional Perspectives

Rabobank: Non-agricultural employment data supports USD strength, Fed expected to keep interest rates unchanged




Jane Foley, head of Rabobank's foreign exchange strategy, said in an email that good data should be good for the U.S. dollar because it shows that the Federal Reserve will not be forced to cut interest rates in the short term and the dollar will be supported by safe-haven buying.

JPMorgan Chase cuts euro-dollar and pound-dollar forecasts




Paul Meggyesi, chief foreign exchange strategist at JP Morgan Chase, wrote in a report to clients that the forecast for the euro against the US dollar was lowered because of the impact of global public health events and the weaker-than-expected European economy at the beginning of the year. Worries have lowered the outlook for the pound against the dollar.

Investor confidence in Europe is particularly vulnerable to public health events, as traders "painfully realize that the eurozone economy is overly sensitive to other global shocks, such as trade conflicts and the survival threats facing the automotive industry." The bank lowered its euro-dollar forecast by the end of the year from 1.14 to 1.11 and its medium-term forecast to 1.08.

In a separate report, Meggyesi wrote that at a time when Britain's transition to low-growth, low-income countries and trade negotiations with the European Union are facing uncertainty, we strongly doubt that the pound is eligible for structural or functional undervaluation. The bank lowered its forecast for the pound against the US dollar in the first quarter from 1.32 to 1.27, and lowered its end-of-year estimate from 1.33 to 1.30.


Westpac Bank: RBA is too optimistic on Australian economic forecasts




Western Pacific analysts point out that the Reserve Bank of Australia ’s quarterly report shows that the Australian economy is expected to grow by 2.7% and 3.0% in 2020 and 2021 respectively. Although they are slightly lower by 0.1 percentage points than last November ’s estimates, they are still It is too optimistic to address the internal and external economic risks facing the country at all.

The bank expects that the next step in the economic situation will be taken by surprise by the Reserve Bank of Australia, so demand may be forced to cut interest rates again in April. In this process, the Australian dollar may still go low first. Although the current exchange rate has been at an 11-year low since 2009, it has not yet fully taken into account the risks of the country's economic fundamentals and the expectations of the central bank to cut interest rates.


Summary of investment bank views

CIBC: USD will lose momentum next year and will drop sharply to 93.4 in Q3




The analyst team at Imperial Commercial Bank of Canada (CIBC) expects the dollar index to continue to decline in the coming quarters. Analysts predict that the US dollar index will trade at 95.5 in the first quarter of 2020 and will fall to 93.4 in the third quarter of next year. Although the Federal Reserve has taken some measures to cut interest rates and protectionism has not solved the problem of unfavorable current account balance, the dollar has successfully rebounded in the past year.

After the pace of growth appears to have slowed in the fourth quarter, the United States appears to be expected to resume growth in early 2020 due to improved interest-sensitive demand, especially housing. This should make the Fed forever give up interest rate cuts, which will support the dollar. However, we believe that the gradual reduction of global uncertainty in the coming year will offset this effect, which will lead to a partial reversal of the safe-haven demand for the US dollar.


Rabobank: EUR / USD will fall to 1.09 in the next 3 months and 1.11 in 9 months




Any decline in the US dollar by the end of next year is expected to be mild, as other central banks have also provided more accommodative monetary policy conditions. The Australian side may mean the first quantitative easing policy. In the past 2 years, the market has underestimated the strength of the dollar against the euro. The change since the beginning of that period is that the market is no longer shorting the dollar, which means it should be more sensitive to any bad news.

Invariably, the US dollar remains the only dominant currency in the global payment system, and the US economy is still performing well relative to other major countries. The euro is expected to fall further against the dollar next spring, however, according to our view, the Fed will cut interest rates sharply by the end of next year, so it is expected that the dollar will have some room to fall in the second half of 2020.


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