In their July 2018 Currency Outlook report, Tempus, an exchange rate and global payments company, provides a detailed report including the following topics and sections:

In Brief

• Mexico elected Andres Manuel Lopez Obrador as the new president, bringing a new era of leftism to the country, but the Mexican Peso recovered steadily
• The USD saw its third month of gains
• The European Central Bank showed confidence in the economy, easing scheduled to end in December
• The British Pound sank further with Brexit concerns
• The Canadian Dollar reached its worst level in a year while coping with trade concerns and slow growth
• Stocks and commodities are seeing the results of tariffs concerns

In Focus – The Canadian Dollar falls on trade uncertainty.

The View – Momentum for the U.S. Dollar Likely to Slow as Corrections are on the Way

• The USD saw gains based on economic divergence between the U.S. and other regions, political instability in the EU, Fed interest rate hikes and lack of order in global markets
• With a “trade war” with China on the horizon as the Trump administration plans to add tariffs to finished products and China has vowed retaliatory measures
• Despite the politics surrounding the newly proposed tariffs, the USD did not feel the pain as businesses look to adjust for the future
• The Chinese Yuan and commodities have plunged with the discussion on new tariffs, as the risk has been assessed to be on the side of China and nations which produce raw materials
• The U.S. push toward unilateral tariffs and testing of the existing trade pacts could see the USD depreciate as other countries take counter-measures against the U.S.
• The European Central Bank meeting in mid-June lead to the determination that the economy could withstand elimination of quantitative easing and increased interest rates in 2019
• The Euro climbed at the end of June, after falling to its weakest ranges since November
• Italian political uncertainty has stabilized for the moment and the Euro and other neighboring currencies should see a good month ahead
• With eight months left in the deadline for the Brexit deal to be signed, the British Parliament has challenged every part of Prime Minister May’s administration
• The health of the British Pound is at stake if economic activity does not increase and the Bank of England sees no room for rate hikes

IBC Members can download the complete Currency Outlook from the members-only section of the IBC website under the Special Reports section.  IBC membership is free for all regular IHA members – to learn more and to join, visit the IBC membership information page.