Forex Learning: The Cause of Major Currencies (G10 Currencies) Moves Up
Let’s first look at what currencies are listed as G10 Currencies or Major Currencies. They are USD (United States), POUNDSTERLING (UK), EURO (European), AUSTRALIA Dollar (Australia), NEW ZEALAND Dollar (New Zealand), YEN (Japan), SWEDISH KRONA (Sweden), NORWEGIAN KRONE (Norway), SWISS FRANC (Switzerland), Canadian Dollar (CANADA).
Currency – This currency is included in major currencies or also called G10 Currencies. So far we are always based on economic data and related fundamentals and technical charts in a pairing currency. But often we forget one important thing that according to this expert to be a benchmark of the current market participants.
Quoted from CNBC.Com, is Dominic Bunning, FX Strategist HSBC which states that the current major currency much driven by: POLITICS. Yes indeed, politics in a country will greatly affect the stability of the country’s currency. And lately the much-cared about politics. Many of the world’s largest and largest currency movements are due to political problems and market sentiment to the country’s stability.
Example # 1: POUNDSTERLING ENGLAND
Pound as one of the most widely traded currencies around the world suffered a devastating fall in 2016 due to BREXIT. BREXIT is nothing but a political polemic that has long been a discourse finally happened. GBP / USD has dropped more than 16% since June 23, 2016 and then when this BREXIT decision was made. Through CNBC.Com, Bunning sees that Poundsterling is still strongly weakened in view of the political outlook that is still challenging.
Example # 2: USD UNITED STATES
USD is experiencing a prolonged crisis slowly began to gradually rise in 2016 this year. But only recently since the election of Donald Trump as the new US President, as if the appetite (desire) of market participants against the USD grows instantly. As a result of the USD Index jumped up to the highest level of 13 years.
Is this a coincidence? Certainly not. A healthy politics creates a sense of security, trust and equanimity when we invest in a country’s currency. The risks caused by the dynamics become smaller so that our investment is also more secure.