Noor Capital | Dubai TV Mohammed Hashad’s Interview, 23 May 2022

In an interview on Dubai TV, Mohammed Hashad, Head of Research and Development Department at Noor Capital and a member of the US Society of Technical Analysts, commented on the latest developments of the financial markets, most notably: In the oil sector, the question is raised whether the market’s current circumstances indicate an expected increase in demand, which may lead, in turn to surging production of black gold, and in the beginning; Hashad believes that that it is worth noting that oil prices started this week’s trading with a noticeable surge at the $ 115 per barrel level, and oil prices benefited from many upbeat economic data in the markets, which collectively pushed oil investors to a state of optimism, and the current data also indicates that there is scarcity of supplies, particularly as far as fuel supplies are concerned, in addition to the decline in oil inventories during the previous week.

With regard to increasing production, Hashad pointed out that he does believe that OPEC’s policy is obvious, and that the group is committed to the amount of production agreed upon since 2020, which is 430,000 barrels per day, in an attempt by the oil-exporting countries to achieve balance between supply and demand levels, but the European Union, was and still is the main driver of oil prices due to the ongoing consultations and talks regarding the intention of the European Union to ban Russian oil imports, and this is the factor that will be the main driver of oil prices in the upcoming weeks.

Hashad also commented on the steady selloff transactions of the US dollar during the past week, amid the surge of US treasury bonds and the current hawkish talk about raising the interest rate. He stressed that there is a clear decline of the US dollar and this is reflected by the dollar index, which measures the strength and performance of the US currency against a basket of major currencies worldwide. The dollar index has already moved away from its highest levels in several years, and is currently hovering around its lowest level in two weeks, amid strong profit-taking, but the main reason is that investors have priced the movement of the markets as they also price the interest rate hike next June, and therefore, came of the exposure the US dollar marked selloff, amid ongoing debate about the possibility of the US economy entering a recession that could put more pressure on the US dollar with declining US Treasury yields as one additional cause for the dollar’s current performance, but on the overall trend, Hashad estimates, the US dollar could rebound and turn back to its gains on the general trend and in the long term.

Asked whether easing the mandatory lockdown in China could help drive the growth of the global economy and help the recovery of export-related currencies, Hashad has said: “This is indeed true, as soon as China announced the easing of the lockdown measures and lifted the restrictions related to Covid. -19 in Shanghai, and as soon as it became potential that life could return to normal at the beginning of next month, the markets soon reacted with a recovery in oil prices and with a clear surge. China also benefited, of course, from the possibility that the administration of US President Joe Biden would reduce tariffs on China’s imports as one of the largest economies In the world, and one of the economies that consume the most crude oil”.

Hashad concluded his speech by saying, “I believe that China’s progress in this regard will lead to more gains for the currencies associated with exports, and more precisely commodity currencies”.