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Preamble:
Last week, the market focused on the US personal consumption expenditures (PCE) price index data, after inflation data from Australia and Canada unexpectedly higher, causing nervousness in the market. Eventually, the Fed's preferred inflation gauge was in line with expectations, and the market let its guard down, anticipating an increased likelihood of a Fed rate cut, and the dollar moved lower.
On June 28 last week, the U.S. Department of Commerce released data showing that the PCE price index in the United States in May grew at a month-on-month rate of 0%, the lowest in recent times, in line with market expectations. What's more, the year-on-year growth of the core PCE price index, which excludes food and energy prices, was also in line with expectations, reaching its lowest level since March 2021. The data showed signs of easing inflation in the United States, sparking speculation that the Federal Reserve would cut interest rates.
Next, consumer spending edged higher, reinforcing optimism that the Fed could help the economy achieve a "soft landing". The data showed that personal spending growth accelerated slightly in May, while personal income also increased, while market expectations for the Federal Reserve to cut interest rates at least once this year continued to strengthen. According to LSEG's calculations, the market has slightly increased the likelihood of a rate cut in September, while Fed Funds futures are also showing signs of easing. One or two rate cuts of 25 basis points each time are expected this year.
On July 1, 2024, the central parity of the USD/CNY exchange rate is yuan, while the real-time exchange rate is. The detailed data shows the dynamic changes of the exchange rate, which provides an important reference for investors to pay attention to market trends and investment decisions. On July 1, 2024, the USD/RMB exchange rate continued to show greater volatility, opening today and closing yesterday, reaching the highest and the lowest. Behind this volatility is a reflection of market concerns and changes in sentiment regarding the global economic outlook, monetary policy and geopolitical risks. As the world's main reserve currency, the trend of the US dollar not only directly affects the mainland's foreign trade exports and capital flows, but also affects the nerves of the global financial market.
At the same time, the volatility of US 10-year and 2-year Treasury yields has also attracted the attention of the market. The U.S. dollar fluctuated wildly after the release of inflation data, falling as low as 105.74 at one point, but ended the day sliding slightly. This series of data and market reactions highlight the market's concern and expectations for the direction of inflation and monetary policy in the United States. Under the interplay of economic data and monetary policy, market expectations and investor sentiment have undergone subtle changes.
Especially in the current global economic situation, the policy actions of central banks have a significant impact on the market. As one of the most important central banks in the world, the Federal Reserve's monetary policy adjustment will affect the nerves of the global market. Not only that, but as the world's main reserve currency, the trend of the US dollar has attracted much attention. From the perspective of inflation data, the year-on-year growth rate of the PCE price index in the United States slowed down, mainly due to the base effect during the epidemic last year and the volatility of global commodity prices. The Fed tends to adopt a "gradual" monetary policy, flexibly adjusting interest rates based on data and economic trends.
On July 1, 2024, the central parity of the yen/RMB exchange rate in the interbank foreign exchange market is, and according to the real-time data of that day,. The fluctuations in the yen-renminbi exchange rate reflect market expectations and sentiment towards the Japanese economy, the Chinese economy and the global economy. The yen-renminbi exchange rate has shown a relatively stable trend today, and from now on, the volatility is small, but the market is still changing. The forex market in 2024 will undoubtedly face many challenges and opportunities. The movement of the yen/renminbi exchange rate is affected by many factors, including macroeconomic indicators, trade wars, geopolitical tensions, etc.
Recent data showed a slowdown in inflation, leaving room for the Fed to cut interest rates. The market's expectation of future Fed interest rate cuts is gradually increasing, but the specific timing and magnitude of interest rate cuts need to be further observed. In addition, the US dollar fluctuated after the release of inflation data, which also reflected the market's worries and expectations for the US economy and monetary policy. The status of the US dollar as a safe-haven currency is affected by multiple factors such as the global political and economic situation and US economic data.
The slowdown in inflation data has a negative impact on the dollar, but it will remain uncertain due to market risk appetite and other factors. Overall, the global economy is facing many challenges and uncertainties, and policy adjustments by central banks have a significant impact on market trends.
On July 1, 2024, the central parity of the GBP/RMB exchange rate in the interbank foreign exchange market is: .
namely
Based on today's GBP to RMB exchange rate:
Investors should pay close attention to changes in economic data and monetary policy signals, adjust investment strategies in a timely manner, reasonably diversify risks, and do a good job in asset allocation. With the evolution of the global economy and policy adjustments, market trends will remain uncertain, and only by remaining cautious and responding in a timely manner can we obtain better returns on investment.
Epilogue:
In summary, the market's concern about US inflation and the Fed's monetary policy continues to heat up. The slowdown in inflation data and the market's increased expectations of a Fed rate cut have provided more room for investors to maneuver, but also brought more uncertainty. In future investment, it is necessary to pay close attention to changes in economic data trends and policy signals, flexibly respond to market fluctuations, and invest steadily, so as to achieve better asset appreciation and risk control. May we seize the opportunity in the market, be flexible, and win the success of investment!
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