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Treasury

Daily Market Patrol

Market Patrol 22 May 2020

The science of today is the technology of tomorrow.

Edward Teller
Indicative Selling Rates
against MUR
USD
27 May 2020
  • AUD
  • 27.01
  • 0.6677
  • BWP
  • 3.45
  • 0.0854
  • CAD
  • 29.50
  • 1.3712
  • CNY
  • 5.68
  • 7.1197
  • DKK
  • 5.99
  • 6.7491
  • EUR
  • 44.43
  • 1.0984
  • HKD
  • 5.25
  • 7.7080
  • INR
  • 0.54
  • 75.1277
  • JPY
  • 37.82
  • 106.9613
  • KES
  • 38.14
  • 106.0591
  • NZD
  • 25.20
  • 0.6231
  • NOK
  • 4.12
  • 9.8092
  • SGD
  • 28.67
  • 1.4108
  • ZAR
  • 2.36
  • 17.1526
  • SEK
  • 4.24
  • 9.5477
  • CHF
  • 42.05
  • 1.0396
  • GBP
  • 49.92
  • 1.2341
  • USD
  • 40.45
  • 1.0000
  • AED
  • 11.08
  • 3.6496
The safe-haven demand for the greenback surged as risk-off engine at full steam on news that China is set to impose new national security legislation on Hong Kong after last year’s pro-democracy unrest.
Fundamental News

EUR/USD
The Single currency felt the pull of gravity on Friday, tumbling from $1.1000 level the previous day to $1.0930, amid fears that China’s decision to impose new Hong Kong security law would lead to major US-China tussle. The risk that Hong Kong could lose some of its favorable U.S. trading terms that have helped it maintain its position as a global financial center, supported the greenback.

 

GBP/USD 
The Pound unfazed at $1.2204 despite British five-year government bond yields fell below zero for the first time on Thursday, a day after Britain sold its first government bond with a negative yield, ahead of British retail sales data due today.

 

USD/JPY
The Japanese yen soared to 107.40 per dollar after the Bank of Japan decided on Friday to launch a new lending facility that aims to channel more funds to small and midsize businesses suffering from the economic blow of the coronavirus pandemic.

 

AUD/USD
The Australian Dollar edged lower to $0.6540 after rating agency Fitch’s decision to cut Australia’s outlook to negative from stable and on escalating Sino-American tensions.

 

USD/ZAR
South Africa's rand rallied to 17.68 against the greenback on Thursday after the country's central bank cut its main lending rate by 50 basis points to 3.75% on Thursday to shield the economy, strangled by an eight-week-old lockdown aimed at reining in the coronavirus. Rate cuts this year now total to 275 basis points.

 

USD/MUR
On the domestic foreign exchange market, the USD/MUR idled at 40.30(selling) post-Bank of Mauritius’ intervention yesterday.

Fundamental & Technical Data
Economic Indicators-Local Time

10:00 - GBP - Retail Sales (MoM)(Apr)

15:30 - EUR - ECB Publishes Account of Monetary Policy Meeting

16:30 - CAD - Core Retail Sales (MoM)(Mar)

 

 

 

Central Bank Interest Rates
Last Change
New Meeting
Federal Bank of U.S
0.00-0.25%
16-Mar-2020
10-Jun-2020
European Central Bank
0.00%
10-Mar-2016
04-Jun-2020
Bank of England
0.10%
19-May-2020
18-Jun-2020
Bank of Japan
-0.10%
28-Jan-2016
16-Jun-2020
Reserve Bank of Australia
0.25%
18-Mar-2020
02-Jun-2020
S.Africa Reserve Bank
4.25%
21-May-2020
-
Reserve Bank of India
4.00%
22-May-2020
-
Bank of Mauritius
1.85%
16-Apr-2020
-
Looking for Markets correlation?
Market Correlation is a measure, statistical or observational, that gives a positive or negative link between the pricing of multiple currencies.

Bulls & Bears Levels
Resistance and Support
Levels
EUR/USD
GBP/USD
USD/JPY
USD/ZAR
R3
1.1065
1.2317
108.17
18.40
R2
1.1037
1.2283
108.01
18.00
R1
1.0994
1.2253
107.81
17.81
PP
1.0965
1.2219
107.65
17.50
S1
1.0922
1.2189
107.45
17.23
S2
1.0894
1.2156
107.29
16.58
S3
1.0851
1.2125
107.08
15.92
Technical Analysis - Forex Charts
Safe-haven nature of FRANC SWISS may plummet USD/CHF to a downfall
Chart updated on 13.04.2020
  • From an Elliott Wave standpoint, USDCHF could potentially unfold into compelling impulsive Wave C of the zigzag correction of Wave (2) to a narrowing region 0.9550 (50% retracement of Wave (1)) to 0.9395 (100% projection of Wave A through B) in the near term trend, from the downside bias from April 6th high of 0.9797.
  • Price could immediately start to shoot back up into Wave (3) on a longer perspective.
  • Piercing above the resistance 0.9905 would endorse the structure.
  • Alternatively, broader bearish invalidation of Elliott Wave Structure rest at 0.9191 of March 9th low while Relative Strength Index signals a bullish recoil higher for the pair.
Japanese Yen rebound may fizzle its way back to Safe-haven status
Chart posted on 14.04.2020

• After rallying to the downside from a high of 112.22 to 101.17 amid global pandemic threat, USD/JPY has been in a correcting mode since 9th March 2020 and seemed to have recently completed an W-X-Y Double Zig-Zag structure of Wave (2) reaching a high of 111.64 on 27th March 2020.
• Two strong indicators were flashing a trend reversal: ending diagonal at Wave 5 of Wave c and bearish RSI divergence.
• On the hourly chart, as per Elliott Wave analysis, the pair might resume its downwards trend targeting 100.64 - 93.78 to unfold Wave (3), a projection of 100%-161.8% of Fibonacci level.
• At 107.70 today, USD/JPY is percolating towards its target from 110.41 to 107.84, as per chart.
• On a side note, resumption of a bullish USD/JPY would mark an invalidation of the Elliott Wave structure above 112.22

Weekly Market Update on Radio One by Reshma Peerun Rajwani
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    Head - Forex And Derivatives
    +230 5251 4855
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    Head – Treasury Sales
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    Senior Dealer - Treasury Sales
    (+230) 5943 9837
Disclaimer
Please note that the information published is purely indicative. It is based on technical data from sources which the Bank verily believes to be authentic, though its timeliness or accuracy cannot be warranted or guaranteed. AfrAsia Bank Ltd issues no invitation to anyone to rely on this bulletin and neither we nor our information providers shall be in no way whatsoever, liable for any errors or inaccuracies, regardless of cause, or the lack of timeliness, or for any delay or interruption in the transmission thereof to the user. The indicative rates and other market information are subject to changes at the Bank's discretion. Whilst every effort is made to ensure the information is accurate, you should confirm the latest situation with the Bank prior to making any decisions.