Hopes of war against covid 19 also affected the forex market. The American dollar losing its safe-haven status received another blow for the fifth consecutive week to trade in reds.
Fundamentals Affecting Forex Market News
Five major fundamentals primarily affected the performance of g7 currencies from Gbp to usd forex news. The major news that affected forex market are:
1. Geopolitical Tensions
Tensions between the U.S. and China escalated on Wednesday. The U.S. government charged 2 spies for China’s government.
They were accused of stealing classified information and hacking into computer systems of companies researching vaccines for treating the coronavirus.
The American government also added more pressure to the Beijing administration. It gave China 72 hours ultimatum to shut down the Houston embassy.
The ultimatum came amid espionage accusations and warned it to expect more tough measures. Tensions continued on Thursday as another Chinese national was hunted for being a spy.
China retaliated and ordered the closure of the U.S. embassy in Chengdu, on Friday. These geopolitical tensions affected the performance of all currencies from the gbp to jpy.
Negative sentiments favor the safe-haven currencies like the American dollar, Swiss franc, and Japanese yen against the risk assets.
2. Positive Global Forex Market News
On Monday, positive news on coronavirus fights uplifted global moods. The University of Oxford, in conjunction with AstraZeneca Plc, developed a coronavirus vaccine.
This renewed hopes for the fight against the virus. In early trials, human testing results proved decisive and moved to the next stage of more extensive human trials.
Forex traders also resonated with positive vibes from the E.U. economic recovery stimulus. The traders reacted to these positive sentiments to engage on a bullish run on risk assets such as the Australian dollar and NewZealand dollar.
3. Coronavirus Pandemic
Looking at the coronavirus statistics, as usual, it continued on the upward trend. As on Sunday 26th July, confirmed cases stood at 16.2 million while the fatalities hit 0.6 million.
On the positive forex news, 9.9 million people have so far recovered from the virus.
Weekly, the total number of COVID 19 increased by 1.7 million globally. This increase was higher than the previous week’s increment of 1.58 in new spikes.
4. Economic Data
Major news that affected forex market includes economic data released by countries. Some posted excellent data, while others performed poorly.
The financial data include employment figures, retail sales, production, private sector, and the service sector.
The economic data affected dominated news headlines from Gbp to usd forex news.
5. Oil
Oil prices fluctuate to gain 1.25% supported by the weakening of the dollar. However, the geopolitical tensions weigh heavily on oil prices.
Changes in oil prices affect commodity-related assets.
G7 currencies Performance
Here is the performance summary table of g7 currencies in forex market
Table: performance summary for the g7 currencies
| Currency pair | 20th July | 26th July | average | Percentage change | remarks |
| USD | 95.772 | 94.380 | 94.958 | 1.574 | drop |
| GBP/USD | 1.2662 | 1.2791 | 1.2732 | 1.7784 | gain |
| EUR/USD | 1.1446 | 1.1656 | 1.1599 | 1.9951 | gain |
| USD/JPY | 107.25 | 106.14 | 106.84 | 0,81 | drop |
| USD/CHF | 0.9389 | 0.9208 | 0.9296 | 1.9017 | drop |
| USD/CAD | 1.3535 | 1.3415 | 1.3447 | 1.2005 | drop |
| AUD/USD | 0.7014 | 0.7104 | 0.7097 | 1.5291 | gain |
| USD/NZD | 1.5207 | 1.5046 | 1.5078 | 1.3247 | drop |
Dollar Currency Forecast Bearish
The dollar received a fifth consecutive week loss to close in the reds. In the week ending 26th July, it fell by 1.57% to close at 94.435.
In the previous week, the dollar had dropped by 0.73%. Major news that affected forex market to push the dollar down includes coronavirus spikes, geopolitical tensions, and covid 19 vaccines.
It was a bad week for the Greenback right from the start of the week. Forex market news of advancement towards a coronavirus vaccine weighed heavily on it at the beginning of the week.
At the beginning of the week, positive global sentiments weakened it. Also, a new economic stimulus from the Fed dented the Greenback.
Domestic issues negatively impacted the demand for the Greenback. Forex market news of the American administration sending Federal agents to quell protests added more damages.
On the warpath, rising Geopolitical tension between the U.S. and China didn’t help the dollar currency forecast as usual.
The continuing spikes in new COVID 19 cases is another blow that pushed the Greenback on the downswing.
On Thursday, America posted weak economic data that didn’t help the dollar. The unemployment figures went upwards to 1.416 million, following 1.3 million in the previous week.
Economic recovery is prolonged. Production records reduced while the service sector went contracted. With a poor economic outlook, the dollar was on the downward contrary to expectations.
GBP/USD
The United kingdom had another busy week on the economic calendar. Gbp to usd forex news played a role in the bullish run of the pound. The pound was supported by an excellent economic outlook in the U.K.
There was a marked improvement in sales, manufacturing, and the private sector to support the sterling pound. More support for the pound also came in later in the week. The upswing came in from improved economic indicators and positive progress on trade talks.
However, forex market news on Brexit uncertainty jolted the sterling into losing earlier gains in the week. This came after the pound had started very well riding on positive global sentiments.
In the week, the pound rebounded by 1.80% to close at $1.2794, having lost 0.43% in the previous week.
From gbp to usd forex news, the coronavirus pandemic caused havoc to weaken the dollar while uplifting the pound.
EUR/USD Bullish Run
Europe also had a busy week on the economic forex market news.
Looking at the forex figures, the euro rallied strongly in the week by 2.00% to close at $1.1656, better than a 1.13% gain in the previous week.
Overall consumer index and private sector were on the upswing. The production and service sectors in many countries did not disappoint either.
However, EUR was negatively affected by geopolitical forex market news arising from the increasing tension between the U.S. and China.
At the beginning of the week, the E.U. Recovery Fund agreement boosted the euro.
USD/JPY
Japan was busy the first half of the week, on the economic calendar, then went on holiday on Thursday and Friday.
By the close of the week, the Japanese Yen rose by 0.82% to ¥106.14 against the Greenback. In the previous week, the yen had slumped by 0.08%.
The export sector contracted slightly from 28.3% to 26.2%. Also, both the manufacturing and services sectors contracted. There was a marginal increase in the production sector from 40.1 to 42.6, with the Services PMI increasing dismally from 45.0 to 45.2.
This economic figures had an insignificant impact on the yen, however, Japan started the week lower due to positive global vibes and poor economic data.
The Japanese yen received a much-needed boost from a weakening U.S. dollar and a coronavirus vaccine’s progress. Also, geopolitical tensions and spikes in covid 19 new cases favored the yen.
On the gbp jpy forex news, the Japanese yen performed poorly attributed to global sentiments and geopolitical tensions. Moving forward, the universal sentiments and geopolitical tensions will continue to feature prominently in the gbp jpy forex news.
USD/CHF
There was no much economic data from Switzerland; the Swiss franc rallied on improved economic outlook and U.S. dollar weakness.
In relation to gbp jpy forex news, the Swiss franc gained on risk aversion measures in reaction to the geopolitical tensions, poor economic data from the U.S., and covid 19 worries.
The USD/CHF currency pair opened the week stronger at 0.9389 and closed lower at 0.9208, having gained 1.9017 %.
USD/CAD
With few economic activities in Canada, the loonie danced to the tune of crude oil prices and positive global forex news. The financial report was a relatively busy week on the economic calendar.
The loonie grew stronger by 1.22% to close the week at C$1.3415 against the Greenback. It had increased marginally by 0.09% to C$1.3415 in the previous week.
The loonie started the week very well on positive sentiments and good economic data. Significantly improved retail sales and inflation figures supported the loonie over the week.
Also, Crude oil prices grew, adding more support to the Canadian dollar. However, when the global sentiments turned negative, the Canadian dollar dropped to be the week’s biggest loser.
AUD/USD
Australia posted impoverished economic data to weaken the Aussie. It was a relatively quiet week for the Aussie Dollar.
Retail sales and business confidence dropped attributed to COVID 19 pulling the Australian dollar southwards which was to be expected.
Early in the week, forex market news towards the coronavirus vaccine provided much support to the loonie. Surprisingly, geopolitical tensions failed to downplay the coronavirus vaccine forex market news to send the Aussie into reverse.
By the close of the week ending 26th July, the Aussie Dollar increased by 1.56% to close at 0.7105.
Nzd Forex News
New Zealand had a quiet economic calendar, hence nzd forex news dominated by geopolitical tensions and coronavirus vaccines.
The nzd forex news revealed increased export trade but had little impact on the kiwi. The revival of geopolitics tensions on Friday pulled the kiwi downwards.
Like the Australian dollar, hopes on coronavirus vaccine to uplift the global economy supported the kiwi also. The Kiwi Dollar gained 1.28% to close at $0.6641 by the end of the week.
Conclusion
The coronavirus primarily dominated the forex market news. Also, the geopolitical flare-ups affected forex trading.
The American dollar faced a tough week with losing against the major currencies. Weakness was more significant against the euro and the Australian dollar.
The dollar currency forecast indicates that it will continue downwards for the weeks to come fuelled by slow economic recovery and coronavirus pandemics.