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Will the strong US dollar start to lose upward momentum?


Will the strong US dollar start to lose upward momentum?

The factors supporting the strong momentum of the US dollar have gradually weakened this year. The US Dollar Index (DXY) fell to 105 points during this week’s trading after failing to breach the 106.5 point level in recent weeks. Despite this, the US dollar remains high since… The beginning of the year increased by more than 3.5%, supported by the US economy remaining strong and the Federal Reserve’s adherence to its strict stance towards interest rates, which increases the attractiveness of the dollar, but there are many challenges facing the performance of the US currency in the coming period.

1. The American economy is no longer overheated

The annual GDP growth rate in the first quarter was only 1.6%, which is the worst quarter since the technical recession in the first half of 2022, which negatively affected the US dollar in the currency trading market . In April, both the ISM services and manufacturing index recorded a reading of less than 50.
point, indicating that the economy may slow in the second quarter of 2024. The US consumer confidence index fell for the third straight month in April, reaching 97, the lowest level since July 2022.

2. The labor market in the United States is tight

New employment in the non-farm sector fell to 175,000 jobs in April from 315,000 jobs in March, falling below 200,000 for the first time in the past five months, and the annual growth rate of average hourly wages slowed in April to 3.9% for the third month in a row. This is the first time since June 2021 that it has fallen below 4%.

The ISM service sector employment index fell to 45.9 points in April, below 50 for the third month in a row, and the employment data released last Friday (May 3) led to a decline in the yield of 10-year US Treasury bonds to below 4.6%, recording the lowest… level since April 9, and interest rate futures once again reflected expectations of a rate cut by the Federal Reserve in September.

3. The slowdown in inflation has stopped

Al
though the inflation slowdown in the United States has stalled, it is not enough for the Fed to abandon its dovish stance. At the Federal Open Market Committee (FOMC) press conference after the meeting on May 1, Chairman Powell stated that the next interest rate adjustment from… It is unlikely to be a rate hike.

The core PCE index rose 2.8% annually in March, which is down from a high of 5.6% in February 2022 and is approaching the Fed’s forecast of 2.6% in the fourth quarter of 2024. Therefore, inflation data may prevent a decline in the dollar index. Below the 50-day moving average (at around 104.56) next week.

The most important factors affecting the US dollar

The US dollar is variable and multiple factors can change the value of this currency. Being aware of these factors helps you make better decisions and prepare to make a profit in different financial markets. Below are the most important factors that can affect the US dollar.

1. Interest rate

One of the most important factors that affect the US
dollar is the interest rate set by the Federal Reserve Bank. A higher interest rate means an increase in the value of the US dollar as the price of money becomes more expensive. A lower interest rate means that the rate of lending or borrowing is cheaper, which reduces the value of the dollar, because This is a very important indicator that you should keep in mind so that you can see the path of the US dollar.

2. Economic growth rate

The most important indicator for any economy is the economic growth rate. A higher rate will increase the value of that national currency and a lower growth rate will reduce its value.

If the US economic growth rate increases, this is a positive signal that can increase the demand for the US dollar and grow its value. If the opposite scenario occurs, this will be a negative signal for the economy and can reduce the value of the economy, and even expectations about the US economy can change the price of the US dollar.

3. Inflation rate

The inflation rate is the average rate o
f prices of various products in the economy and services, and it is a very important indicator. A high inflation rate is a bad signal for the economy as it leads to higher prices and a decrease in the value of the national currency. However, a low inflation rate has a completely opposite effect to the scenario mentioned above, as it leads to an increase in the value of the national currency. The national currency because this is a positive signal for the economy.

Changes in the US inflation rate are a very important indicator that can change the value of the US dollar. A high inflation rate is a negative signal for the US dollar, while a low inflation rate is a positive signal for the US economy, which raises the value and price of the US dollar.

4. Unemployment rate

The unemployment rate is the number of all people aged 15 to 65 who have no job while they are actively searching for a job.

If the unemployment rate in the US economy increases it means that more people are out of work, which is a negative s
ignal for the economy that also shows slowing growth which will lead to a decline in the value of the US dollar.

Now if the unemployment rate decreases this indicates that the economy is growing and doing very well, it will benefit the entire society and the demand and value of the US dollar will continue to rise.

5. New monthly jobs

New jobs are one of the most important indicators of the American economy. The growth of new jobs monthly means that the economy is growing and can absorb the human resources of the economy very well, which is a positive indicator that will increase the value of the US dollar in the world.

The same is true when new job creation declines, and investors and economic activists see it as a bad signal that will devalue the US dollar.

6. Geopolitical tensions

There are more geopolitical tensions than ever before in the world, and for 2024 these tensions will continue to rise as there are many new powers in the world competing for more resources in the world.

Any geopolitical ten
sion is very good for the value of the US dollar because that will increase the demand for the national currency of the United States, as all people want to convert their money into US dollars because the US economy is the largest economy in the world and therefore it is a very safe place to put money.

7. Wars in the world

War means uncertainty, and it causes people to leave war zones and migrate to better and safer places, and since the United States is the most powerful country in the world and has the largest economy, it is the safest place to transfer capital and the best place to immigrate as well.

Any serious war in the world will cause the value of the US dollar to rise and the demand for this currency will continue to rise.

8. Retail sales

Retail sales show how consumers spend, so an increase in retail sales means that consumers are spending more and this is a very good sign for the economy, and if retail sales decrease, this is a negative indicator for the economy that indicates there is a probl
em within the economy.

Source: Maan News Agency

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Business & Finance

Western warnings of an economic catastrophe in the West Bank


London – Ma’an – Western officials warned of an “economic catastrophe” in the West Bank if the occupation does not renew “a vital exemption that Israeli banks need in order to maintain their relations with their Palestinian counterparts.”

The British newspaper “Financial Times” reported that this exemption, which expires on July 1, “allows the payment of the costs of vital services and salaries associated with the Palestinian Authority, and facilitates the import of basic materials,” such as food, water, and electricity, into the occupied Palestinian territories.

Without this exemption, Israeli banks will stop dealing with Palestinian financial institutions, and the Palestinian economy will effectively stop over time, according to three Western officials.

The newspaper quoted an American official as saying that not renewing the exemption ‘will not only be at the expense of Palestinian interests, but also at the expense of the security and stability of Israel and the region.’

It also quoted two other Weste
rn officials as saying that Washington is leading the efforts aimed at renewing the exemption, as it ‘appealed to its allies to exert pressure on the Israeli government.’

British officials said the United Kingdom was ‘also concerned’ about this issue, according to the Financial Times.

This issue is expected to be discussed at the G7 finance ministers’ meeting, expected later this week in Italy, according to officials.

The newspaper explained that the Palestinian economy trades with other economies in multiple currencies, including the Jordanian dinar, which is widely used in the West Bank.

The Palestinian economy operates with the Israeli shekel, so Palestinian financial institutions must pass through the Bank of Israel and other Israeli banks in order to access it.

Source: Maan News Agency

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Business & Finance

An environmental center warns of the decline in biodiversity in Iraq


The Iraqi Center for Environmental Monitoring warned, on Wednesday, of the decline in biodiversity in Iraq, due to climate change and human threats.

In a statement on the International Day for Biological Diversity, today, Wednesday, the Center urged the Iraqi authorities to take urgent practical measures to protect the country’s biodiversity, which is exposed to many threats, including declining water resources, high temperatures, and scarcity of rain, pointing to ‘the necessity of controlling poaching of all animals and the bulldozing of agricultural lands, as well as pollution resulting from industrial and oil activities.

The center called for activating and approving legislation related to the protection of biological diversity, re-registering and documenting species and reference classifications of local organisms, and working to declare and register protected areas.

Source: National Iraqi News Agency

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Business & Finance

Tamkeen supports the participation of 15 local businesses in Saudi Food Show


Manama, The Labour Fund (Tamkeen) supported the participation of 15 Bahraini food businesses at the Saudi Food Show, Saudi Arabia’s largest international food and beverage showcase. Over 1,000 exhibitors are expected at the event, including leading brands of a range of restaurants, as well as food and beverage manufacturing companies from 97 countries and more than 80 renowned regional and international chefs.

The exhibition, which is taking place from 21 to 23 May at the Riyadh Front Exhibition and Convention Center, provides a prime platform for Bahraini companies to display their products and services.

Participating enterprises will gain valuable insights into sector trends; exchange best practices; and forge relationships with industry leaders. Notable brands such as IFFCO Group, Bidfood, and Lactalis Group will be present, alongside events such as the Saudi Food Trend Trail, which will showcase more than 30 innovative food and beverage concepts, and the YouthX Saudi competition, featuring the brightest
emerging culinary talents from all over the world.

Maha Abdulhameed Mofeez, the Tamkeen Chief Executive said, “Our commitment to supporting Bahraini businesses’ participation in this event highlights our dedication to enhancing their global competitiveness. This will help strengthen the pivotal role the private sector plays in the growth of our national economy.”

She added, “With the manufacturing sector contributing 14% to GDP in the final quarter of 2023, we are keen to bolster this sector’s growth trajectory. By affording Bahraini enterprises a platform to showcase their offerings on a global stage, we aim to foster meaningful connections and partnerships for them with industry leaders. This endeavor elevates the local food and beverage landscape while contributing to the Kingdom’s sustainable economic growth.”

Safaa Abdul Khaleq, the CEO of Export Bahrain said: “Our partnership with Tamkeen reflects a firm commitment to supporting the growth of the food and beverage sector in Bahrain and enhancing the
success of the enterprises operating in it. We are excited to help spotlight participating enterprises and showcase the diverse range of products and services originating from Bahrain on a global platform. Fostering a thriving local food and beverage ecosystem characterized by innovation and sustainability is one of our priorities. This event offers us the opportunity to acquire the latest insights and forge valuable business connections.”

Tamkeen’s sponsorship of the Kingdom of Bahrain’s pavilion at the Saudi Food Show is aligned with its 2024 strategic priorities focused on economic impact and the private sector under three pillars; increasing economic participation through employment opportunities for new entrants, expanding career development opportunities available to the Bahraini workforce, and further developing the private sector by supporting enterprises and boosting productivity and the adoption of technology.

Source: Bahrain News Agency

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Business & Finance

NBR conducts 343 inspection visits, reports 36 violations during Q1 of 2024


Manama, The National Bureau for Revenue (NBR) reaffirmed its continuous commitment to enhancing the level of business compliance within the local markets and ensuring adherence to all regulations and legislation for the effective implementation of VAT and Excise including the Digital Stamps Scheme.

The NBR conducted 343 inspection visits within the local markets across different governorates in the kingdom during the first quarter of 2024. These inspections aimed at monitoring the market and providing high levels of protection for customer rights and combating VAT and Excise evasion, along with spreading awareness of the rightful ways of implementation.

The NBR has confirmed that effective oversight of the local market has resulted in reporting 36 VAT violations, in which administrative fines have been imposed in accordance with the VAT Law. The reported violations were related to the failure to comply with the conditions for issuing VAT invoices, failure to show prices inclusive of VAT, failure to display
a VAT certificate in a visible location.

The NBR identified several violations that may be considered suspicions of VAT or Excise evasion, in which legal actions will be taken against violators and referred those who are proven to have committed evasion crimes to the competent authorities to initiate a criminal case against them, which may be punishable by imprisonment for five years and a fine equivalent to three times the amount of VAT due or by imprisonment for one year and a fine equivalent to double the evaded excise according to the Excise law.

The NBR emphasised that the cooperation of businesses and consumers is integral to the success of the ongoing inspection campaigns to achieve the highest compliance standards, the NBR also urges all concerned parties to report any violations or evasions of the VAT or Excise law by contacting the NBR call center at 80008001 available 24 hours, 7 days a week, or through the National Suggestions and Complaints System (Tawasul), or by email through vat@nbr.gov.bh f
or VAT related queries, and to ds@nbr.gov.bh for the Digital Stamps Scheme queries.

Source: Bahrain News Agency

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Business & Finance

Bahrain Islamic Index closes higher


Manama, Bahrain All Share Index has closed at 2,014.11 points, marking a decrease of 3.89 points below the previous closing.

This decrease was due to the drop in the financial sector and the material sector.

Bahrain Islamic Index has closed at 786.54 points, marking an increase of 0.91 points above the previous closing.

Results indicated that 38 equity transactions took place with a volume of 1,653,155 worth BD 362,861.

Investors traded mainly in the materials sector, representing 46.45% of the total value of securities traded.

Source: Bahrain News Agency

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Business & Finance

CBB 12 Month Treasury Bills Issue No. 116 oversubscribed by 142%


Manama, This week’s BD 100 million issue of Government Treasury Bills has been oversubscribed by 142%.

The bills, carrying a maturity of 12 months, are issued by the Central Bank of Bahrain (CBB), on behalf of the Kingdom of Bahrain.

The issue date of the bills is May 23, and the maturity date is May 22, 2025.

The weighted average rate of interest is 6.08% compared to 6.02% in the previous issue on April 18.

The approximate average price for the issue was 94.211% with the lowest accepted price being 94.1450%.

This is issue No. 116 (ISIN BH0002013405) of Government Treasury Bills. With this, the total outstanding value of Government Treasury Bills is BD 2.110 billion.

Source: Bahrain News Agency

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Business & Finance

Palestinian companies support the steadfastness of our people in Gaza

Ramallah – Together – Islam Abu Arra – Despite the huge losses incurred by Palestinian companies and banks as a result of the war waged by the occupation; However, it did not hesitate to move quickly to provide support to the Palestinian people in the Gaza Strip, where the land and people were subjected to a wave of severe attacks, and the destruction was not limited to property, but also affected the lives of innocent people.

Despite the harsh conditions imposed by the siege and the closure of the crossings, the food and in-kind assistance provided by these companies and banks had a significant impact in alleviating the suffering of our people in Gaza and confronting the effects of the ongoing war of extermination in the eyes of the entire world.

Humanitarian initiatives of Palestinian banks

In a statement issued by the Bank of Palestine Group, the company announced the provision of tangible humanitarian support during the humanitarian crisis that the Gaza Strip is going through as a result of the recent
war.

The statement included providing a variety of services and assistance to the affected and displaced people, as the bank provided food parcels in the West Bank in addition to providing one million meals in the Gaza Strip.

The statement explained that the tremendous humanitarian efforts included providing hot meals, mineral water, and urgent financial aid to patients, in addition to providing winter supplies and providing psychological support to families and children in shelter centers.

These efforts represent a continuation of the assistance provided by the group since the beginning of the war, the total value of which amounted to approximately 2.5 million US dollars.

In addition, the Bank of Palestine Group announced a strategic partnership with the Welfare Association to care for 20,000 orphans in the Gaza Strip, with an annual contribution of $2 million. The Arab Islamic Bank made a contribution worth $250,000 to provide food supplies in the Gaza Strip, in response to an appeal from the United Nat
ions World Food Programme.

In a similar move, the Palestine Islamic Bank provided thousands of hot meals to displaced families in the Gaza Strip, affirming its solidarity with the national efforts to help the people of Gaza in light of the difficult circumstances they are going through as a result of the war.

Palestine Communications Group and PADICO are at the forefront of assistance

Despite the significant losses in the infrastructure of the Palestinian Telecommunications Group “Paltel and Jawwal”, and even the loss of some employees as a result of aggressive targeting, it acted in a high-level humanitarian spirit during the difficult times that the Gaza Strip is experiencing as a result of the war, and did not skimp on its efforts in providing support and assistance under direct supervision and direction. From the Vice Chairman of the Board of Directors of the Palestinian Telecommunications Group, Mr. Bashar Masri, as these efforts were organized and implemented despite the challenges, which contributed
to alleviating the suffering of the population and providing them with appropriate support in these difficult circumstances.

Since the beginning of the war, the Palestinian Telecommunications Group and PADICO moved immediately to provide support and assistance to the people of Gaza. It was the first initiator to provide a helping hand to our people in Gaza since the first days of the war. It provided hundreds of thousands of food parcels and ready-made meals to the displaced and affected people, and opened kitchens. ‘Gaza Kitchens.’ Al-Azza” to provide free meals in the northern, southern and central areas of the Strip.

With this strong solidarity and serious cooperation, the cooperation between the Palestine Telecommunications Group and PADICO appears as an example to be followed in providing support and assistance in light of crises, and many influencers on social media published calls for companies at the beginning of the war to redouble their efforts and follow the example of these leading companies in
providing assistance to our people in Gaza. This interaction reflects the commitment to supporting the community and standing by the people of Gaza at all times.

In a related context, Bashar Masri, through his ‘On the Ground’ initiative, in cooperation with the Wall and Settlement Authority, restored houses that were completely burned by settlers in the villages of Al-Mughayir and Duma in the West Bank during the escalating settler attacks.

For its part, Ooredoo has provided tangible humanitarian efforts to support the affected people of the Gaza Strip. Since the beginning of the war, the company has provided thousands of free food packages, and it still continues to provide support to the displaced and affected people in the region.

In addition, Ooredoo has organized a number of entertainment activities for children, in cooperation with the Sharek Youth Forum and other local bodies, with the aim of relieving the psychological pressure on children in light of the difficult conditions they are going through
.

Despite the great challenges and difficulties imposed by the war and the lack of resources, the Palestinian companies, some of which we mentioned in our report, rushed to extend a helping hand to our people in Gaza. These efforts embodied the solidarity of private sector companies with the Palestinian citizen, and showed courage and determination to face challenges and provide support in difficult circumstances.

Source: Maan News Agency

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Business & Finance

Transport Ministry: Agreement to open new transport lines between Iraq and Saudi Arabia


Baghdad, The Minister of Transport, Razzaq Muhaibas Al-Saadawi, headed a ministerial delegation that included a number of Directors General, participated in the ‘Future of Aviation 2024 Conference’ in the Kingdom of Saudi Arabia, for the period from 20 to 22 May this year.

A statement by the Ministry’s media office said that the Minister headed a delegation that included the Director General of the General Company for Airports and Air Navigation Management, Abbas Al-Baidhani, the Director General of the General Company for Iraqi Airways, Manaf Abdel Moneim Ajel, and a number of officials in the Ministry, to participate in the (Future of Aviation 2024) conference in Riyadh, which witnessed the participation of 120 speakers, they reviewed their expertise on the most prominent issues facing the global aviation sector, including growth and investment, airports and air connectivity, supply chain management and flexibility, shipping and logistics services, air traffic and the future of aviation, technology, digita
l transformation and safety, and others.

The statement stated that, on the sidelines of the conference activities, the Minister met with a number of his counterparts in the Arab region, to discuss ways to enhance joint cooperation and exchange experiences, in a way that contributes to the development of the Iraqi transport sector.

It added: “The Iraqi delegation held several meetings with international officials that reached important results and agreements related to the transport sector, in the presence of the Iraqi Ambassador to the Kingdom of Saudi Arabia, Safiya Al-Suhail.”

It pointed out that during the minister’s meeting with his Saudi counterpart, it was agreed to activate air links between Iraqi and Saudi airports, in light of the increasing demand by citizens in both countries for religious tourism travel between the two countries.

There was also an agreement between Transport Minister Razzaq Muhaibas Al-Saadawi and his Saudi counterpart to activate air links between Iraqi and Saudi airports.

T
he statement pointed out that the minister said, during his meetings with a number of officials, that the transport sector in Iraq is witnessing a major development and, noting that the aviation sector has recently witnessed a recovery at the level of services at airports, and the demand of travelers for the Iraqi national carrier, which has expanded its travel destinations, and is still continuing its efforts in this regard.

Source: National Iraqi News Agency

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Business & Finance

The dollar continues to decline…currency and metal prices

Bethlehem – Maan – Currency exchange rates against the shekel, today, were as follows:

Dollar- Buy 3.67 Sell: 3.76

Dinar – Buy: 5.16 Sell: 5.26

EUR- Buy: 3.98. Sale:4.02

Metals: Gold: Buy 2413 Sell 2415

Silver: buy 31.49 sell 31.51

To subscribe to the SMS service to receive currency rates on a daily basis and other economic news, including the price of gold and silver, oil prices in global markets, the Palestine market, and other news that interests you, send the word ‘economy record’ or ‘sub econ’ to the number 37192.

Source: Maan News Agency