Wonderful introduction:
Without the depth of the blue sky, there can be the elegance of white clouds; without the magnificence of the sea, there can be the elegance of the stream; without the fragrance of the wilderness, there can be the emerald green of the grass. There is no seat for bystanders in life, we can always find our own position, our own light source, and our own voice.
Hello everyone, today Avatrade Aihua Foreign Exchange will bring you "[Aihua Foreign Exchange Platform]: May the US dollar collapse? The United States faces "painful" economic transformation." Hope it will be helpful to you! The original content is as follows:
The US dollar index rebounded last week, and the Federal Reserve said that due to uncertainty in US tariff policies, there is no intention to rush to cut interest rates this year, which provides support to the US dollar. Gold prices rose sharply on the weekly basis and hit record highs due to geopolitical and economic uncertainty.
Last week, foreign central banks announced a busy week. Both the Bank of England and the Bank of Japan maintain interest rates stable, but we believe the former will still cut interest rates in May, while the latter will raise interest rates in May. The Bank of Sweden has kept interest rates unchanged, while the Swiss National Bank cut its policy rate by 25 basis points, in both cases, we believe the easing cycle may have ended. The Brazilian central bank raised Selic interest rates by 100 basis points and suggested that the pace of tightening will slow down in the future.
The Fed remained silent last week, and the Fed said it had no intention of rushing to cut further interest rates this year due to uncertainty in U.S. tariff policies. "We won't be in a hurry to act." Fed Chairman Powell said: "The Fed kept interest rates unchanged on Wednesday and expected two 25 basis points cuts this year, the same as forecast three months ago.
After ending a two-day monetary policy meeting, the Federal Reserve announced that it would maintain the interest rate range of 4.25% to 4.5% unchanged at 2 p.m. Eastern Time on Wednesday, and announced that it would slow the balance sheet shrinkage from April.
The Federal Reserve also issued a FOMC statement, which predicts an upward trend in U.S. inflation and lowers expectations for economic growth. Considering the signs of stagflation, the Fed still said it would cut interest rates twice in 2025, similar to the dovish signal revealed by the sharp rate cut in September last year.
The Bank of Japan announced last Wednesday thatKeep the current interest rate level unchanged and continue to maintain the policy interest rate at 0.5%.
The Bank of Japan announcement showed that the nine central bank review aihuaforex.committee members attending the monetary policy meeting unanimously passed the decision to maintain the current interest rate.
Bank of Japan Governor Kazuo Ueda said at a press conference on Wednesday that the trend of Japan's economy and price is basically consistent with the central bank's previous expectations, but there is a high degree of uncertainty in the US government's tariff policy, and its possible impact on the US economy, the world economy and the Japanese economy is still unclear.
Last Thursday, the Bank of England announced that it would keep the benchmark interest rate unchanged at 4.5%, warning the market not to assume that interest rate cuts will be cut in the next few meetings, citing high uncertainty in the global and British economy.
Amid the intensification of global trade tensions due to the tariff policy initiated by the United States, the Monetary Policy aihuaforex.committee decided to keep interest rates unchanged with an 8-1 vote, with only external aihuaforex.committee member Swati Dingra voting for a 25 basis point cut.
Asian market
The momentum of the Japanese private sector fell sharply at the end of the first quarter, with the aihuaforex.comprehensive purchasing managers index (PMI) falling from 52.0 to 48.5, the first contraction in five months. The manufacturing purchasing managers index fell from 49.0 to 48.3, the lowest level in a year and the ninth consecutive month of contraction. What is even more worrying is the sharp decline in the service industry Purchasing Managers index, from 53.7 to 49.5, the lowest level since mid-2024.
According to S&PGlobal's AnnabelFiddes, the recession was driven by a "new round of decline in service activity" and an accelerated recession in manufacturing. The aihuaforex.company pointed out that "strong inflationary pressure has suppressed sales", and customers are increasingly hesitating about placing orders.
The broader situation is growing pessimism. Japanese aihuaforex.companies list a range of structural and cyclical challenges – from ongoing inflation and labor shortages to aging population and deepening global trade uncertainty. As a result, business confidence in future activities has dropped to its lowest level since August 2020.
The Australian manufacturing Purchasing Managers Index soared from 50.4 to 52.6, a 29-month high, while the service Purchasing Managers Index rose from 50.8 to 51.2. The aihuaforex.comprehensive purchasing managers index (PMIComposite) rose to a 7-month high of 51.3.
JingyiPan of Standard & Poor's Global Market Intelligence stressed that output growth is not only the strongest in seven months, but also "broad-based" in both manufacturing and services. Despite a sharp rebound in export orders due to weather disruptions and a weak global situation, domestic demand has pushed new orders to its highest growth in nearly three yearsRate.
However, the report also highlights a significant decline in business confidence. The curb of price increases may help support near-term demand. But "the uncertainty of tariffs may continue to cast a shadow on output growth in the aihuaforex.coming year."
European Market
The mayor of Istanbul, Türkiye, was suspended and sent to prison.
Turkish stock market is banned from shorting for one month; the Turkish central bank issues liquid notes to support the lira, and the bill auction will begin on March 24.
U.S. market
Canada retail sales fell -0.6% month-on-month to CAD 69.4B in January, a drop of greater than expected, indicating a sluggish consumer spending.
The biggest drag came from automotive and parts dealers, while overall sales in three of the nine sub-industries fell.
Core retail sales, excluding gasoline and car-related purchases, also fell -0.2%.
More worryingly, Statistics Canada pre-estimate showed that retail sales fell again in February by -0.4%.
The above content is all about "[Ihua Forex Platform]: The US dollar may collapse? The United States is facing "painful" economic transformation". It was carefully aihuaforex.compiled and edited by the Avatrade Forex editor. I hope it will be helpful to your transactions! Thanks for the support!
Every successful person has a beginning. Only by having the courage to start can you find the way to success. Read the next article now!