FX news: Mexican peso, rand get trading boost
Forex.com has announced that they have added two new currency pairs to their service – USD/MXN and USD/ZAR.
Jane Foley, research director at Forex.com, says the inclusion of the Mexican peso and South African rand onto their platform is recognition of continued globalization.
“They provide fresh opportunities for clients. Mexico’s position within both the G20 and the OECD are strong endorsements of its development since the mid-1990s and are evidence of its increased global presence,” she says.
“At the same time, South African financial institutions have remained stable and its money markets orderly despite a painful recession and particularly sharp rises in unemployment; a performance which will enhance South Africa’s emerging presence on the world stage.”
Carry trades in these currencies have been popular over the last few years as the interest rates on them have been so high. Traditionally, customers who are long in these currencies find they can get a good return.
However, Brian Dolan, chief currency strategist at Forex.com told the weeklyFiX today: “Carry trades are quite volatile at the moment in light of ongoing uncertainty about the global recovery, so USD/MXN and USD/ZAR have been trading based on short-term risk sentiment. When the environment is constructive for global growth and risk trades are ‘on’, we have seen traders buying MXN and ZAR more aggressively.