Foreign investors need to see Nigeria stepping up its efforts to
diversifying away from oil dependence, while also boosting infrastructure
spending across major sectors. If the correct strategy is implemented towards
improving local macroeconomic conditions and shielding against external forces,
Nigeria could move a step close to nearing its true potential. Although the
elections will affect investor confidence in the near term, it’s the critical
steps taking after that will shape sentiment towards the largest economy in
Africa.
Pound clings onto Brexit delay hopes
Pound
bulls were injected with a renewed sense of confidence this morning following
reports that UK Prime Minister Theresa May could delay Brexit beyond 29 March.
This
development will certainly remove some element of uncertainty over Brexit
whilst soothing fears over the UK crashing out of the EU without a deal in
place next month. However, a major risk accompanied by extending Article 50 is
that Britain will find itself trapped in a Brexit limbo. While the Pound has
scope to extend gains on Brexit delay expectations, the medium to longer term
outlook remains blurred by a thick cloud of uncertainty. With the odds of a
second referendum also rising after Labour leader Jeremy Corbyn made a U-turn to
back the move, another question floating in the air is whether there will even
be a Brexit.
With just
over one month left until the UK is scheduled to leave the European Union, we
expect the Pound to display extreme levels of sensitivity and volatility to Brexit
headlines. Although some attention will be directed towards the inflation
report hearings later today, this will likely be overshadowed by a crucial
cabinet meeting where the Brexit deadline will be discussed.
Focusing on the technical picture, the GBPUSD is pushing higher on the
daily charts with prices trading around 1.3130 as of writing. The combination
of Brexit delay expectations and Dollar weakness has the potential to push the
GBPUSD towards 1.3200 in the near term.
Dollar
waits for Jerome Powell
The
Dollar has lost its mojo in recent days, slipping closer to the 96
psychological level due to a number of domestic and external factors.
A string of soft economic data from the United States, coupled with
growing speculation over the Fed taking a break on monetary tightening this
year, has brought nothing but bad news for the Dollar. The risk-on flows have
also pulled investors away from safe-haven assets and currencies, which will
inevitably pressure the Dollar further. Although Dollar bulls were initially
supported by the economic divergence between the US and everyone else, this
theme could be coming to an end.
Much
attention will be directed towards Fed Chair Jerome Powell’s congressional
testimony later in the day. Powell’s testimony could offer investors some
additional insight into the Federal Reserve’s monetary policy stance for 2019.
The central bank head is expected to reiterate that the Federal Reserve will
remain “patient” on future hikes. We see the Dollar weakening against a basket
of major currencies if Powell adopts a dovish tone during his testimony.
Commodity spotlight – Gold
Gold
weakened towards $1,326 this morning, as US-China trade optimism sent investors
sprinting to riskier assets.
Although
the precious metal is at risk of depreciating further in the short term amid
the risk-on sentiment, the medium to longer term outlook swings in favour of
Gold bulls. For as long as geopolitical risks, concerns over plateauing global
growth and speculation over the Fed taking a pause on rate hikes remain key
themes, Gold is insulated from extreme downside shocks.
In regards to the technical picture, sustained weakness below $1,330 is
likely to encourage a decline towards $1,318. However, bulls still remain in
control above the $1,303 higher low.
Have you heard this? Many Nigerian exporters have been defrauded of huge amount of money in the process of exporting commodities to foreign countries. Do you know why? They were not trained on export operations, management, documentations and the best methods of payment in export trade. This is terrible!!! Nigerians cannot continue to lose money to foreigners in the course of export business. Exporters, why don’t you get a practical manual that teaches the stages of export trade from processing and packaging of commodities to receipt of payment by the foreign buyers. It teaches export operations, export management, export documentations and methods of payment in export trade? It is a contemporary step-by-step guide to export trade. It tells all the contemporary dynamics in export trade. To get it, click on the link below:
http://www.tectono-business.com/2016/02/contemporary-step-by-step-guide-to.html
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