In their June 2018 Currency Outlook report, Tempus, an exchange rate and global payments company, provides a detailed report including the following topics and sections:
In Brief
- The USD appreciated 2.2% in May against other major currencies
- The USD saw its best 2-month advance since 2016 with the April and May appreciation
- After a month that caused bond market panic, Italy formed a government
- Following trade tariffs imposed on China by the U.S. and allies, countermeasures will be on the horizon
- No clear direction in the NAFTA discussion to save the agreement and new metals tariffs sand the Canadian Dollar and Mexican Peso
- The British Pound fell and the Japanese Yen and Swiss Franc rose
In Focus
The Mexican Peso’s 2018 gains that rendered it the highest preforming currency throughout the year, have been erased by a mix of factors including: high unemployment, contracting industrial production, slowing of services and manufacturing sectors, inflation below target and uncertainty over coming presidential elections
The View – Global decision makers get ready to gauge effects of changes to international relations
- Although U.S. markets have made huge steps after financial crisis that began in 2008, other global markets have not fared so well
- Italy’s lack of governmental cohesiveness has caused a slow recovery
- Italy saw turmoil in May as it struggled put a proper Prime Minister in place under President Sergio Mattarella and the Euro saw a 3.6% decline as traders pulled out of what was viewed as a dangerous investment scenario
- May saw the Euro sink to the weakest level in more than 10 months
- In a push for better trade terms with China from the U.S., China was levied tariffs along with other U.S. allies, with the U.S. maintaining that many of the current imports can be made in the U.S.
- In reaction to U.S. imposed tariffs, world leaders have stepped up to reject tariffs
- UK and EU leaders will meet on June 28 to discuss Brexit’s future amidst Prime Minister May’s unclear strategy
IBC Members can download the complete Currency Outlook from the members-only section of the IBC website under the Special Reports section. IBC membership is free for all regular IHA members – to learn more and to join, visit the IBC membership information page.
