Forex oanda blog

As it turns forex, the forex markets are currently treating the Loonie and the Aussie as inseparable.

The fact that the two have been numerically correlated see chart below for oanda better part of can also be discerned with a cursory glance at the charts above. Why is this the case? As it turns out, there are a handful of reasons. You can see from the chart above that the year-long commodities oanda and sudden drop corresponded with similar movement in commodity currencies.

Beyond this, both currencies are seen as attractive proxies for risk. Even though the blog in the eurozone has very little actual connection to forex Loonie and Aussie which are oanda sound, geographically distinct, and economically insulated from the crisisthe two currencies have recently taken their forex from political developments in Greece, of all things.

Finally, the Bank of Canada is in a very similar position to the Reserve Bank of Australia RBA. Both central banks embarked on a cycle of monetary tightening inonly to suspend rate hikes indue to uncertainty over near-term growth prospects.

While GDP growth has indeed moderated in both countries, price inflation has not. In fact, the most recent reading of Canadian CPI was 3. Further complicating the picture is the fact that the Loonie is near a record high, and the BOC remains wary of further stoking the fires of appreciation by making it more attractive to carry traders.

In the near-term, then, the prospects for further appreciation are not good. A pullback towards parity — and beyond — blog like the only realistic possibility. While 30 years from now, Mr. First of all, the putative economic boom that is taking place in Australia is being driven entirely by high commodity prices and surging production and exports. Since peaking at the end of April, commodity prices have fallen mightily.

As commodities prices have fallen over the last two months, so has the Australian Dollar. In addition, while oanda will probably remain strong over the long-term, it may very well slacken over the short-term, due to declining economic growth across the industrialized world. This notion is reinforced by oanda 1. The Reserve Bank of Australia last hiked its benchmark interest rate in Novemberand may not hike again for a few more months due to moderating economic growth and proportionally moderate inflation.

The apparent stabilizing of the dollarthen, might let some air out of the currency down under. Blogthe winter of despair was followed by the spring of uncertainty.

For now at least, they are responding by dumping emerging market currencies. As you can see from the chart above which shows a cross-section of emerging market forexblog currencies peaked in the beginning of May and have since sold-off significantly. If not for the rally that started off the year, all emerging market currencies would blog be down for the year-to-date, and in fact many of them are anyway.

Still, the returns for even the top performers are much less spectacular forex in forex Similarly, the MSCI Emerging Markets Stock Index is down 3.

There are a couple of factors that are driving this ebbing of sentiment. First of all, risk appetite is oanda. Over the blog couple months, every flareup in the eurozone debt crisis coincided with a sell-off in emerging markets.

Some analysts forex that because emerging economies are generally more fiscally sound than their fundamental counterparts, that they are inherently less risky. Unfortunately, while this proposition makes theoretical sense, you can be assured that a default by a member of the eurozone will trigger a mass exodus into safe havens — NOT into emerging markets. Blog emerging market Asia and South America is somewhat insulated from eurozone fiscal problems. On the other hand, they remain vulnerable to an economic slowdown in China and to rising inflation.

Emerging market central banks have avoided making forex interest rate hikes hence, rising bond prices — for fear of inviting further capital inflow and stoking currency appreciation — and the result has been rising oanda inflation.

You can see from the chart above oanda the darkest areas symbolizing higher inflation are all located in forex economic regions. While high inflation is not inherently problematic, it is not difficult to blog of a downward spiral into hyperinflation.

Again, a sudden bout of monetary instability would send investors rushing to the exits. While most analysts myself included remain bullish on emerging markets over the long-termblog are laying off in the short-term.

Oanda we aim to analyze and try to forceast the forex markets, none of what we publish should be taken as personalized investment advice. Forex exchange rates depend on many factors like monetary policy, currency inflation, and geo-political risks that may not be forseen.

ACM Forex AVA FX CitiFX Pro CMC Forex CMS Forex Dukascopy Easy Forex eToro Forex. FREE Daily Updates Enter your email address: Delivered by FeedBurner Subscribe. Features Forex Forex Glossary Get Started Investing in Forex: FOREX - Wikipedia Forex Street OFT.

Brutally honest opinions of forex trading brokers LMAX Oanda FXCM Dukascopy Interactive Brokers