Overview of the key events of 2016

[KristinaFIBO]

Overview of the key events of 2016

 

Throughout the year, the http://www.fibogroup.com[/b]/']FIBO Group shared the current news from the world of finance and the opportunities they could use in their trading. 2016 is approaching its end. A year of radical change and historically important decisions. The most significant events of 2016 are presented for your attention.

 

Trump

 

December 8-9, 2016, during one of the most intriguing new elections in the history of the United States of America was elected. Donald Trump, having received more than 270 needed electoral votes, was elected the 45th president of America. January 20, 2017 will be the official inauguration of the new head of the White House.

 

During the election campaign Donald Trump promised to permanently abolish many of Obama's decisions, in particular "cancel and replace" the health care reform, abolish restrictions on the production of hydrocarbons, raise the middle class. Looking at the actions taken by one of the world's most famous multimillionaires, we can assume that it is aimed to fundamentally reshape the political and economic view of the world.

 

The financial world has reacted quite violently to the event: The US indices (DJIA, S & P) have updated their historical highs; the US dollar has become stronger in relation to all the major currencies.

 

Oil

 

At the end of 2016 we can safely assign the highest rating among the other crude oil assets: the most volatile and the most speculative instrument. Through verbal interventions made by the representatives of the world of energy, quotes were soaring and falling by more than 30%. In the end, a significant step on the path of global cooperation was made on November 30, 2016: the OPEC member states agreed to reduce oil production by 1.2 million barrels per day - up to 32.5 million. This is first time since 2008 that the countries decided to take this step.

 

As a result of the oil price increases, which has had a positive impact on the world market conditions. And it allows you to make money.

 

Brexit

 

Britain has always kept aloof in the European community. When on June 24 it became known that almost 52% voted for the UK's exit from the EU, Prime Minister David Cameron resigned, the national currency depreciated by 13% in one day, and there was an unprecedented volatility in financial and commodity markets. Britain, by the way, lost its top credit rating, from "AAA" it fell to "AA", and the Bank of England immediately cut its interest rates.

 

An unprecedented disintegration event in post-war Europe caused a lot of comments: How it will affect the interests of the EU, USA and Russia.

 

Flash crash

 

On the morning of October 7, all the merchants of the world were short of 500 points in the GBP / USD currency pair. Such a sharp change in a split second just could not be true. Nobody believed that additional information sources had to be referred to in order to verify the information. But trading terminals around the world noted the same thing - for a few seconds an unknown trader "hit the quotes glass" so hard that the markets could not stand this pressure. Once again, the financial market has proven that it is only partly predictable and depends on many unpredictable factors. It is this "imperfection" of the market architecture that creates a precedent for similar cases.

 

The US Federal Reserve Interest Rate

 

The US Federal Reserve has implemented a script of "aggressive tightening". The regulator has not only raised the rate by 25 basis points, which was to be expected, but also raised its forecasts for the rate rises to three in 2017. The economic forecasts made by the members of the Federal Open Market Committee have also improved, adding to the overall picture of the finishing touch in bright colors. In other words, the market now has sufficient motivation to buy the dollar now and forever.

The EU interest rate

 

The ECB entered into in 2016 with a 0.05% refinancing rate and reduced it to a record low 0.0% as early as March 2016. This level is maintained to this day, as the main subject for the markets is the fate of the so-called QE stimulus program, which the Bank uses in parallel to the zero rates.

 

Japan's interest rate

 

For the first time in history, the Bank of Japan has set a negative interest rate as a measure to combat the deflationary process, which against the background of an additional and constant emission knocked down the yen by 300 points. Currently, Japan's economy benefits from a weak exchange rate of the national currency - exporters rejoice. Analysts say in one voice about the good prospects for economic recovery with the current low rate of the national currency and a negative key rate.

 

New Zealand's interest rate

 

In 2016, the Reserve Bank of New Zealand cut its benchmark interest rate to a record low of 1.75%. It should be noted that against the background of the 2000-2008 period, the rate was really very low (7.00% was the norm). At the same time the bank had three systematic declines this year and only the first one (March 2016) carried a surprise factor. The subsequent ones were also developing according to an already developed scenario and created opportunities for earnings.

 

The review was prepared by http://www.fibogroup.com[/b]/']FIBO Group analyst Michael Khlestunov.

 

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