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Hello everyone, today XM Forex will bring you "[XM Forex Decision Analysis]: A collection of good and bad news that affects the foreign exchange market." Hope this helps you! The original content is as follows:
The Federal Reserve cut interest rates: In the early morning of October 30, Beijing time, the Federal Reserve announced an interest rate cut of 25 basis points, lowering the federal funds rate target range to between 3.75% and 4%, marking the second interest rate cut this year. It also announced that quantitative tightening would end on December 1. The Federal Reserve's decision to cut interest rates may cause the U.S. dollar to weaken, which will be beneficial to other currencies and push the exchange rates of non-U.S. currencies against the U.S. dollar to rise.
The Central Bank of China launched a reverse repurchase operation: On October 29, the central bank launched a 7-day reverse repurchase operation of 557.7 billion yuan in the open market, with an operating interest rate of 1.40%. This reverse repurchase operation reflects the central bank's concern and maintenance of market liquidity in the short term, which will help stabilize the RMB exchange rate and provide certain support for the RMB.
China-US economic and trade consultations have made positive progress: Vice Premier He Lifeng led a delegation to Malaysia from October 24th to 27th to hold economic and trade consultations with the United States. The two sides reached a substantive framework agreement, including that the United States will "no longer consider" imposing 100% tariffs on China. This news stimulated the short-term appreciation trend of the RMB and also had a positive impact on the risk appetite of the global foreign exchange market.
The economic data in the Eurozone are improving: both the manufacturing and service PMIs of the Eurozone rebounded in October. The manufacturing industry rose to 50.0 from the previous value of 49.8, once again rising to the line of prosperity and contraction, and the service industry rose to 52.6 from the previous value of 51.3, setting a new high since August last year. Good economic data has weakened market expectations for the European Central Bank to cut interest rates this year, supporting the rebound of the euro against the dollar.
Powell expressed caution about interest rate cut in December: Fed Chairman PowellIt was pointed out at the press conference that economic data has changed little since the September meeting, but the lack of data due to the government shutdown has increased uncertainty, and there are "strong differences" within the www.stofoco.committee on the policy path for December. This statement triggered a rapid market adjustment, which cooled the market's expectations for future interest rate cuts by the Federal Reserve, which provided certain support for the US dollar and was not conducive to non-US currencies.
Slowing food inflation in the UK triggers interest rate cut expectations: British Retail Consortium data showed food prices fell the most in the past five years, and the market has therefore increased bets on an interest rate cut by the Bank of England in December. This caused the pound to fall against the dollar for the second consecutive trading day to around 1.3250, and the pound was suppressed to some extent.
The Bank of Japan kept interest rates unchanged and the policy is loose: After the Japanese election, Sanae Takaichi was elected as the first female prime minister in history. Her policy is centered on loose monetary policy, and she has repeatedly stated that "it is necessary to proceed with caution when raising interest rates." The Bank of Japan will hold an interest rate meeting this week, and the market is expected to keep interest rates unchanged. This makes the yen's depreciation obvious and the US dollar against the yen exchange rate has increased.
OPEC+ is expected to increase production to suppress oil prices: OPEC+ plans to increase production every month starting in December, by 180,000 barrels per day each time, and gradually restore supply that has been suspended since 2022. If OPEC+ finally decides to increase production in December, it may lead to an increase in supply in the crude oil market, which will in turn affect the trend of related www.stofoco.commodity currencies and create certain negative pressure on currencies such as the Australian dollar and the Canadian dollar.
JPMorgan Chase lowers the prime rate: JPMorgan Chase announced that it will lower the prime rate by 25 basis points to 7.00%. The adjustment will take effect on October 30, 2025. This move may have an impact on U.S. dollar borrowing costs and market liquidity, which is not conducive to the strengthening of the U.S. dollar to a certain extent.
The above content is all about "[XM Foreign Exchange Decision Analysis]: Collection of good and bad news affecting the foreign exchange market". It is carefully www.stofoco.compiled and edited by the editor of XM Foreign Exchange. I hope it will be helpful to your trading! Thanks for the support!
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