Global Market Snapshot 5th August 2024

Due to growing concerns about an economic recession and rising expectations of a more substantial rate cut by the Federal Reserve, the U.S. dollar weakened. The U.S. Dollar Index fell by more than 1% to 103.23 points, its lowest level in over four months.

USDJPY exchange rate plummeted by 1.84% to 144.56 Yen, the lowest level since February. This decline is attributed to the Bank of Japan raising interest rates to 0.25% this week, the highest level since 2008, which has boosted the Yen. Additionally, escalating geopolitical tensions have increased demand for safe-haven assets, further strengthening the Yen.

USDCAD was little changed at 1.3872. The Canadian dollar edged higher against the US dollar this week, despite concerns over weakening price pressures and deteriorating spending investment in the Canadian economy. The slowdown in US job growth helped reduce the unfavourable interest rate differential for the Canadian dollar. As the Federal Reserve joins the Bank of Canada in an easing cycle, the narrowing interest rate differential is favourable for the Canadian dollar. However, the decline in oil prices puts pressure on the Canadian dollar, as Canada is the largest exporter of crude oil to the United States.

GBP and EUR: Influenced by a Weaker Dollar

GBP rose by 0.53% against the US dollar, rebounding from a one-month low following the Bank of England’s rate cut. EUR increased by 1.12% against the US dollar, reaching $1.0912, its highest level since July 18. Despite some concerns in the economic data from the UK and the Eurozone, the overall weakness of the US dollar provided an opportunity for both currencies to rise.

Bitcoin Trading Near $53,275.3, Down 12.29%

BTC is trading near $53,275, with a decline of 12.29%, marking its largest single-day drop since November 9, 2022. This drop has caused Bitcoin’s market capitalization to decrease to $1,105.9 billion, accounting for 56.04% of the total cryptocurrency market capitalization. Bitcoin’s market cap had previously peaked at $1,435.8 billion. In the last 24 hours, Bitcoin’s price ranged between $52,956.1 and $58,291.4. Over the past seven trading days, Bitcoin has fallen by 18.43%, resulting in a significant decrease in its total market value.