Dollar Firms Brace for Geopolitical Week: What Investors and Business Owners in Oman Need to Know
SINGAPORE: The US dollar strengthened against the euro and the British pound on Monday ahead of a high-profile meeting between US President Donald Trump, Ukrainian President Volodymyr Zelenskiy, and European leaders. Market participants are also keenly awaiting insights from the Federal Reserve’s upcoming Jackson Hole symposium.
The euro declined 0.2% to $1.1683, while the British pound fell 0.1% to $1.3546. This dollar support came as investors scaled back bets on a Federal Reserve rate cut next month, following a rise in US wholesale prices and stronger-than-expected retail sales in July. Currently, money markets price an 85% probability of a 25 basis point rate cut in September.
Fed Chair Jerome Powell is scheduled to speak at the Jackson Hole symposium, taking place from August 21 to 23, on the economic outlook and central bank policy. Although MUFG forecasts a rate cut in September, senior currency analyst Lee Hardman noted it is unlikely that Powell will provide any definitive guidance during this week’s event.
Monday’s key development for investors is the White House meeting where President Trump will convene with Zelenskiy and European leaders to advocate for a rapid peace agreement in Ukraine. This follows Trump’s recent discussion with Russian President Vladimir Putin, in which both agreed that a peace deal should be pursued without an immediate ceasefire. An analyst at ING observed, “Financial markets are continuing to trade like there could be some — still undetermined — path to peace.”
In other currency moves, the dollar gained 0.1% against the Japanese yen, reaching 147.38, while the Swiss franc eased 0.1% to 0.8069. The Australian dollar increased 0.1% to $0.6515, and the New Zealand dollar rebounded by 0.3% to $0.5941 after last week’s decline. In cryptocurrency markets, bitcoin dropped 2% to $115,362.46, and ether fell 4.3% to $4,275.85.
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The evolving US monetary policy landscape, highlighted by the Federal Reserve’s likely rate cut in September and ongoing geopolitical tensions, signals potential volatility in global currency markets that could impact Oman’s trade and investment environment. For businesses in Oman, particularly those engaged in import-export or foreign investment, monitoring currency fluctuations and geopolitical developments is crucial to manage risks and capitalize on favorable exchange rate movements. سرمایهگذاران هوشمند باید در نظر بگیرند diversifying portfolios and seeking opportunities in sectors resilient to global economic shifts amid uncertain policy signals and geopolitical dynamics.
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