It seems that the Chinese coronavirus is gradually becoming the biggest driver in financial markets. At the same time, Donald Trump has recently announced another version of his peace plan for the Middle East. If this agreement manifests itself, then you may expect major changes in exchange rates.
The Agreement of the Century
Today, Donald Trump has announced his peace plan for the Middle East. The plan is called the Deal of the Century. The problem is, desite the name of the deal, it cannot be fulfilled. Initially the Palestinians rejected this plan but President Trump is sure that they will change their mind. So, he is advertising his plan without revealing its details. However, if this agreement is a success for some reason, this is going to be a strong market signal and a major advantage for Trump's team in the forthcoming presidential elections this year. With that being said, the markets are optimistic and the dollar is close to reaching major local highs.
Bitcoin and Fear
The current market uncertainty means that non-conventional assets start growing in value. Cryptocurrencies are some of them. International investors keep on loading up on them to diversify their portfolios and to secure their investments against geopolitical shocks, like the one we could recently see in the Middle East. As a result, despite the fact that Bitcoin used to fluctuate close to 7000 dollars per coin in December 2019, now it's gone all the way up to 9000 dollars per coin.
Dollar's Still Strong
Yesterday, after weaker-then-expected stats from Germany, the U.S. economic reports didn't come in impressive as well. Germany's IFO turned out to be weaker than expected but still promising compared to some of the previous months. As for the USA, we learned about the amount of new home sales, which turned out to be the same as a month ago despite slightly bigger expectations. Still, it should be noted that all of those news releases coming from the U.S. property market are not as powerful as they used to be. As a result, this didn't prevent the dollar from coming close to the 1.10 threshold the next day.
