Category
🗞
NewsTranscript
00:00 After the expectations of the interest rate drop from 6 times to 3 times, the dollar rose to reach the highest level in about 5 months and exceeded the 105 points level in front of the currency basket.
00:15 Then it resumed the decline after the first of April until it reached its lowest level in a week.
00:21 The economic data supported the idea of the US federal government to accelerate the interest rate drop. The dollar is in front of the main currencies and this creates pressure on these currencies, especially the emerging markets.
00:37 However, the dollar despite its lowest level in a week is the best performance among the G2 currencies, which makes the monetary policy makers take measures to support their currencies.
00:51 For example, today we have seen a 34-year low in the lowest level and the Japanese central bank has taken measures to support the currency and towards the end of the liquidity monetary policy.
01:04 Turkey is working to raise the Lira and China and Indonesia are working to stabilize the exchange rate of their local currencies, especially since these countries are exporting, so it is not in their interest to raise their currency because it will remain in countries that import and pay higher interest rates to import the same currency.
01:25 We have seen these efforts to stabilize and support the local currencies in 2022 when Canada and Switzerland recognized the low price of their currency compared to the dollar due to the rising inflation.
01:38 This forced some emerging economies to be afraid of the decline, such as Sri Lanka.
01:44 Now, the Maldives and Latibia are in danger of being afraid of the decline due to or in the case of continuation of the dollar's strength.
01:53 Now, the expected low interest rates have declined due to the bigger data than expected and the strong labor market has declined from six times the low interest rates in 2024, which is about 150 points, to three times, which is about 75 points.
02:12 Now, the good news is that the US Federal Reserve will meet in June and indicates the expectations or the possibility of 56% of the 100% that the US Federal Reserve will lower the interest rates by 25 points to reach 5.25% in June 2024.