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The US dollar is trading at its strongest level against the euro in 20 years as recession fears push the pair closer to parity

"Slowdowns fears are now arguably the main driver of currencies globally," said one strategist at the US Dollar Index hits highs not seen since 2002. The euro is struggling against the dollar in 2022.ipopba/Getty The US Dollar Index reached its highest level since December 2002 on Tuesday.  The climb of more than 1% came largely on the back of a drop in the euro.  An energy crisis in the eurozone is weighing on the shared currency.  A key gauge of the US dollar kicked up to two-decade highs Tuesday, largely fueled by the euro's slump as investors see economic conditions weakening in Europe, with a German data point highlighting slowdown concerns. The US Dollar Index rose as much as 1.4% to 106.64, crossing above the 106 level for the first time since December 2002. The index was hurt as the euro fell by 1.7% against the greenback, buying $1.0245.The EUR/USD pair fell below the 1.03 handle for the first time in nearly two decades. The euro has a heavy weighting on the US Dollar Index, of about 58%. "It is not a secret that the Eurozone economy is not doing great, with the outlook also looking bleaker by the day," Fawad Razaqzada, market analyst at Forex.com, wrote in a Tuesday note. "The weakness is driven by rampant inflation, concerns over energy and rising borrowing costs. We have seen consumer, business and investor sentiment all take big hits, with PMIs also falling. Ongoing tensions between Europe and Russia over natural gas supplies means business sentiment in Germany, in particular, is unlikely to improve any time soon." The euro was hit as European natural gas prices shot up to four-month highs, with investors considering an ongoing strike among oil and gas workers in Norway, the largest producer of oil and gas in Western Europe. Meanwhile, Germany on Tuesday approved legislation that will let the government bailout energy companies strained by the reduced supply of gas from Russia. "The situation on the gas market is tense and unfortunately we cannot rule out a deterioration in the situation," Germany's Economy Minister Robert Habeck said in a statement, according to Reuters. Surging energy prices and supply chain issues led Germany, Europe's largest economy, on Monday to report its first trade deficit since 1991. Monthly exports fell by 0.5% in May from April while imports into the country rose 2.7%. "Slowdowns fears are now arguably the main driver of currencies globally, perhaps even more so than central bank interest rate expectations, which have somewhat taken a backseat in the past few days," Matthew Ryan, head of market strategy at Ebury, a global financial services firm, said in a note Tuesday. "For the most part, economic indicator data out of the major areas has taken a turn for the worse of late, as the increase in consumer prices weighs on both business and consumer sentiment."Citigroup's Economic Surprise Index last week dropped to its lowest level since June 2020 "in a clear sign of the aforementioned deterioration," said Ryan. The US Dollar Index has climbed about 11% so far in 2022 in large part as the Federal Reserve has pushed interest rates higher to combat decades-high inflation. The Federal Open Market Committee is widely expected to raise rates again at its two-day meeting ending July 27. The Fed last month delivered a rate hike of 75 basis points, the largest increase since 1994. Investors on Wednesday will receive minutes from last month's Fed meeting. "Whether the greenback is able to hold onto these gains is likely to be dependent on two things," said Ryan. "The pace of interest rate hikes from the Federal Reserve during the remainder of the year," and the "extent to which global recessions fears are materialised."  Dollar strength helps makes imports into the US cheaper to purchase and money stretch further in Europe for American travelers. But dollar strength can also cut into revenue for US-based companies selling products overseas.The Dollar Index also gauges the greenback's performance against the Japanese yen, the British pound, the Canadian dollar, the Swedish krona, and the Swiss franc. Read the original article on Business Insider.....»»

Category: topSource: businessinsiderJul 5th, 2022Related News

3 Best Performing IPOs of 2021

ZIM Integrated Shipping Services (ZIM), Global-e Online (GLBE) & Roblox (RBLX) are the best three IPOs of this year in terms of returns. US stock market’s performance this year has been nothing short of extraordinary following the dramatic recovery in the previous year. In fact, major indexes touched record highs on several occasions, eventually leading to a boom in company listings.It has been a record year for initial public offerings (IPO). From the beginning of the year through Dec 2, 2021, there has been a total of 976 IPOs, citing an Investopedia article. The article further stated that there has been a 103.3% jump in the total number of IPOs this year compared to last year when the previous record set in the year 2000 was broken.So, what facilitated the boom in IPOs this year? The Federal Reserves’ initiative to keep interest rates at ultra-low levels all through the year along with the government’s stimulus measures to pep up the economy did help stocks climb northwards and encouraged several private companies to go public. At the same time, many startups contributed to the IPO boom as they were in desperate need of cash. Special purpose acquisition companies (SPACs) also contributed to the new company listings.This year, nearly $453 billion was raised by companies from their IPOs, an uptick of 67% from 2020 and more than double from 2019, as mentioned in a business insider article. In reality, most of the firms in the technology sector went public. But there were other high-profile IPOs this year. Notable among them are electric vehicle startups like Lucid and Rivan, and consumer brands such as Warby Parker. Nonetheless, here is a look at the top three IPOs of this year in terms of returns –ZIM Integrated Shipping Services ZIM along with its subsidiaries provides container shipping services. ZIM Integrated Shipping Services went public amid challenging times when the world was plagued by the coronavirus outbreak and companies were facing supply chain disruptions. However, the company displayed enough flexibility and agility in its services, and in the process attracted investors.ZIM Integrated Shipping Services’ IPO date was on Jan 28, 2021, and its IPO price was $15 a share, quoting the Investopedia article. The company’s shares have soared 381.4% so far since its IPO. What’s more, ZIM’s expected earnings growth rate for the next quarter is 54%. The Zacks Consensus Estimate for its next-year earnings has moved up 43.7% over the past 60 days. ZIM, currently, flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.Global-e Online Ltd. GLBE provides a platform to enable and accelerate global, direct-to-consumer cross-border e-commerce.Global-e Online’s IPO date was on May 11, 2021, and its IPO price was $25 a share, quoting an iposcoop article. The company’s shares have climbed 93.2% so far since its IPO. GLBE’s expected earnings growth rate for the next year is 46.5%. GLBE, at present, has a Zacks Rank #3 (Hold).Roblox Corporation RBLX especially develops online entertainment platforms. Roblox’s platforms help users to interact with each other and generate 3D experiences.Roblox went public on Mar 10, 2021, and its IPO price was $45 per share, citing the Investopedia article. Roblox’s shares have surged 55.1% so far since its IPO. Additionally, Roblox’s expected earnings growth rate for the next year is nearly 8%. The Zacks Consensus Estimate for its next-year earnings has moved up 1.2% over the past 60 days. RBLX, currently, possesses a Zacks Rank #3.  Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report ZIM Integrated Shipping Services Ltd. (ZIM): Free Stock Analysis Report Roblox Corporation (RBLX): Free Stock Analysis Report Globale Online Ltd. (GLBE): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksJan 2nd, 2022Related News

Risks tied to a record $226 trillion in global debt will grow if the pace of rate hikes accelerates more than expected, says the IMF

Rate hikes are on the way in the US with inflation at a 39-year high. Policy makers must be cautious not to move too quickly, the IMF said. ipopba/Getty Global debt has soared to a record $226 trillion, fueled in part by the response to the pandemic. But risks associated with high debt are elevated as officials tackle high inflation, the IMF said Wednesday.  Many central banks are preparing to raise interest rates to combat rising prices.  Public and private debt stands at a staggering $226 trillion worldwide, underscoring the importance of policymakers combatting hot inflation by raising interest rates to consider and mitigate the risks from that record amount, the International Monetary Fund said Wednesday. Governments in 2020 rolled out sweeping spending programs to buffer their economies from a collapse in revenue because of the coronavirus crisis, driving the largest one-year debt surge since World War II, the institution said in a blog post on Wednesday. The debt surge, while necessary, "amplifies vulnerabilities, especially as financing conditions tighten. High debt levels constrain, in most cases, the ability of governments to support the recovery and the capacity of the private sector to invest in the medium term," wrote Vitor Gaspar, director of the IMF's fiscal affairs department, Paulo Medas, a division chief in that department, and Roberto Perrelli, senior economist in the IMF's fiscal policy and surveillance division. Even as the pandemic wears on, monetary policy is "now appropriately" shifting focus to rising inflation and inflation expectations. In the US, home to the world's largest economy, annual consumer price inflation in November soared to a 39-year high, to  6.8%. In Europe, a spike in energy prices contributed to eurozone inflation rising to 4.1% in October. Many central banks are preparing to raise interest rates to prevent persistently high inflation, and are also planning to reduce their large purchases of government debt, and such actions will drive up borrowing costs. "The risks will be magnified if global interest rates rise faster than expected and growth falters," the IMF said. "A significant tightening of financial conditions would heighten the pressure on the most highly indebted governments, households, and firms. If the public and private sectors are forced to deleverage simultaneously, growth prospects will suffer." It said the uncertain outlook and heightened vulnerabilities make it crucial for officials to strike the right balance between policy flexibility, nimble adjustment to changing circumstances, and a commitment to credible and sustainable medium-term fiscal plans. "Such a strategy would both reduce debt vulnerabilities and facilitate the work of central banks to contain inflation," it said.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderDec 15th, 2021Related News

Fiat money: Currencies that derive their value largely through trust in the governments that issue them

Fiat money is currency backed by trust in the government that issued it and not tied to a physical commodity such as gold or silver. Fiat money gives authorities a lot of control over its supply and value.ipopba/Getty Fiat money is currency backed by the government that issued it and isn't tied to a commodity such as gold.  Fiat money issuers can have a lot of influence on the economy by controlling the supply of this currency. Overly aggressive monetary policies run the risk of eroding the value of fiat currencies. Visit Insider's Investing Reference library for more stories. Fiat money is the term used to describe currencies that are backed by the government that issued them and aren't aren't tied to the value of a physical commodity such as gold or silver. They derive their value largely through the public's trust in the issuers. Most of the currency in the world is now fiat money. It began to see widespread use in the 20th century when the US dollar was decoupled from the price of gold. With the advent of cryptocurrencies such as Bitcoin, there's been debate about whether such digital assets could ultimately supplant fiat money as the preferred medium of exchange, or at least provide an alternative.How does fiat money work? You've probably heard the expression, "Backed by the full faith and credit of the US government," in reference to the dollar. That's the principle behind fiat money. It gets its value based on the trust people place in the authorities that issue it. Commodity-backed currencies, on the other hand, get their value from the underlying price of the gold, silver, or other materials they're linked to. Today, most money in the world is fiat money. In the US, the Federal Reserve controls the supply of dollars. The European Central Bank controls the supply of the euro common currency. Those are two of the most well-known fiat currencies. Note: The term fiat is derived from the Latin word meaning an authoritative determination or order. This money is legal tender, but it has no intrinsic value. In essence, it has value because the authorities that issued it say it does. Its value can be largely determined by how the issuer's economy performs. And it allows central banks to have a lot of influence on the economy because they can control the money supply.Why do most countries use fiat money today? The use of commodity money has been common throughout history. Coins made from precious metals like silver and gold were the standard for thousands of years. By the 18th and 19th centuries, paper currencies began to take hold, although many of them served as promissory notes to pay specific quantities of gold and silver. Countries like the UK and the US went on to embrace the gold standard, a monetary system tying a standard unit of currency to the value of a certain amount of gold. When the Great Depression and two world wars severely affected the global economy, world leaders created an international monetary system positioning the US dollar as a global currency.International balances were settled in dollars, which were convertible to gold at a fixed exchange rate. The gold standard was in place until 1971, when US President Richard Nixon, faced with surging inflation and high unemployment, ended it as the amount of foreign-held dollars exceeded the amount of gold in the US reserves.The pros and cons of fiat moneyFiat money's relative stability and the ability of central banks to control the supply and manage the economy is one of its biggest advantages. However, those efforts aren't always successful, and some critics argue that instead of providing a cushion against economic shocks, fiat currencies can sometimes exacerbate them if policy makers print too much money."Like with any incumbent technology for an existing system, it kind of mostly works most of the time," says Andy Edstrom, managing director with Swan Advisor Services and author of, "Why Buy Bitcoin: Investing Today in the Money of Tomorrow." But, as inflation rises, and more fiat units are printed, "the cracks are starting to appear in the system," he says.ProsConsIt gives issuers greater control over the money supply, helping them manage the economy.It is relatively stable and easily stores current value, unlike commodity-backed currencies that can fluctuate short-term.It is widely accepted and can be used as legal tender in various settings.  Printing too much money can stoke inflation. Its potentially unlimited supply can erode value and create bubbles.With its value tied to a government, a fiat currency can significantly depreciate if the issuer runs into trouble.Cryptocurrency vs. fiat moneyThe advent of cryptocurrencies has spurred a debate about the future of fiat currencies and whether they'll ultimately give way to digital coins. Cryptocurrencies such as Bitcoin aren't fiat money because they aren't issued, controlled, or backed by any central authority. And in some cases, the total maximum supply is designed to be capped at a certain amount. The price volatility of cryptocurrencies is one reason some skeptics say it is unlikely to supplant fiat money as the dominant medium of exchange. But acceptance of crypto has been growing. For instance, El Salvador this year became the first country to make Bitcoin legal tender. PayPal now allows some users to pay for purchases with Bitcoin. Visa has partnered with crypto platforms on card programs. There are thousands of cryptocurrencies, including Bitcoin, which some call "digital gold." Some cryptocurrencies, called stable coins, can be pegged to commodities or fiat money, which is intended to make them less volatile. Some cryptocurrencies have utility, such as transferring payments or powering decentralized networks and applications. Others are created for fun. And some others can be scams. "It's not used as money yet, transactionally, very much, because of that short-term volatility in purchasing power," Edstrom says of Bitcoin. "But, if it reaches its potential over the next decade or two, then it's likely that the volatility will reduce, and it's likely that Bitcoin will become used commonly as money in the economy as it matures."Fiat moneyCryptocurrencyIssued by a central bank, which controls the supplyHas a potentially unlimited supplyIs legal tender and required to be accepted as payment for goods and servicesIssued and controlled by a decentralized network of computers In some cases, the total number of digital tokens that can be created is fixedIs not legal tender in most places and spending it can be difficult and time consumingThe financial takeawayFiat money is currency that's backed by the public's faith in the government or central bank that issued them and is the standard throughout most of the world. It has no intrinsic value, unlike commodity currency, which is linked to the prices of a commodity such as gold or silver. Instead, fiat money derives its value from the trust people place in the governments that issue it. While fiat money has been the norm since the early 1970s, the emergence of cryptocurrency has some proponents of Bitcoin and certain other digital assets arguing that this new form of currency is a better medium of exchange and store of value. And it has been gaining acceptance in government and business. Time will tell how cryptocurrencies will ultimately be used for financial transactions, and where they'll eventually fit in the international monetary system. For now, keep an eye on the developments and consider the pros and cons of fiat money when making decisions about saving and investing.What is inflation? Why the cost of goods rise over time and what it means for the value of your moneyQuantitative easing explained: How this monetary policy affects you and your moneyKeynesian Economics: A Depression-era idea that's seen a resurgence in the 21st centuryMonetary Policy: How the Federal Reserve attempts to control the US economyRead the original article on Business Insider.....»»

Category: personnelSource: nytNov 19th, 2021Related News

The FDA has expanded its COVID-19 vaccine boosters authorizations

These are Insider's biggest healthcare stories for October 21. Hello,Welcome to Insider Healthcare. I'm healthcare editor Leah Rosenbaum, and today in healthcare news:The FDA authorized booster shots for the Moderna and Johnson & Johnson COVID-19 vaccines;Best Buy lays out its plan for entering the healthcare space;Dermatology startup Zerigo raised a $34 million Series B round to treat skin conditions with UV light.If you're new to this newsletter, sign up here. Comments, tips? Email me at lrosenbaum@insider.com or tweet @leah_rosenbaum. Let's get to it... An employee (R) of Japan's Suntory Holdings receives the Moderna coronavirus vaccine for Covid-19. KAZUHIRO NOGI/AFP via Getty Images The FDA just authorized booster shots of Moderna's and Johnson & Johnson's COVID-19 vaccines and is letting users mix and match shotsThe FDA authorized booster shots of the Moderna and J&J vaccines on Wednesday.The agency also authorized people to get different vaccine brand as a booster shot.J&J recipients can get a booster after two months. Moderna recipients should wait six months. Check it out>> Shoppers enter a Best Buy in New York. Associated Press/Bebeto Matthews A top Best Buy healthcare executive laid out how the retailer wants to help doctors care for patients in their homesBest Buy, known for selling electronics, is pushing deeper into healthcare.Best Buy Health President Deborah DiSanzo laid out its strategy at the HLTH conference in Boston.The retailer wants to help doctors care for patients at home through a new acquisition.Get the full story>> Zerigo makes a light-therapy device to treat skin conditions such as eczema. ipopba/Getty Images See the 17-slide presentation that convinced Livongo's Glen Tullman to invest in a dermatology treatment startupZerigo is a dermatology startup that treats conditions like psoriasis and eczema.It raised $43 million in Series B funding on Thursday led by Glen Tullman's 7wireVentures.Its smart device uses UVB light therapy to treat chronic dermatological conditions.See the slides now>>More stories we're reading:Pfizer says its booster shot has 95.6% efficacy against COVID-19 amid the Delta variant (Insider)A doctor developed a blood test for fibromyalgia. But did he tell the truth to his customers? (STAT)Blood tests that can detect cancer are about to hit the market. But experts are still waiting to see if they can upend deadly disease. (Insider)These doctors have been spreading COVID-19 vaccine misinformation for months (CNN)Pfizer's vaccine cuts the risk of COVID-19 hospitalization in teens by 93% in a CDC analysis (Insider)-LeahRead the original article on Business Insider.....»»

Category: topSource: businessinsiderOct 21st, 2021Related News