A weaker US dollar is needed to support higher oil prices and economic recovery across the GCC region, according to Saxo Bank.
Market turbulence will continue in the short-to-medium term, but the dollar will weaken in the long term and drive a reflationary recovery in global commodity prices, John Hardy, the Danish investment bank's head of FX strategy, said in a virtual briefing on Monday.
"The direction of the US dollar is critical for financial markets across the world, but particularly for oil and for GCC countries with the US dollar at the centre of gravity for the region," Mr Hardy said. "A weaker US dollar is needed to support the regional recovery, and we believe that eventually it will weaken, but this could take some time. In the meantime, there could be significant market turbulence until we can firmly state that we are on the other side of the Covid-19 crisis."
The coronavirus outbreak has claimed more than 433,000 lives and infected more than 7.9 million people worldwide, according to Johns Hopkins University.
Major economies are opening up gradually, following months of business closures, travel bans and movement restrictions to control its spread.
Governments and central banks have pumped about $10 trillion (Dh36.7tn) into the world economy to revive output, stem job losses and support small businesses, according to the International Monetary Fund.
Last week, the US Federal Reserve said it would keep interest rates lower for longer to support an economic recovery from the pandemic, with almost all officials forecasting that interest rates would be kept near zero through to 2022. The central bank also said it will maintain the current level of bond purchases.
Meanwhile, the GCC's economies are being hit by the economic fallout from the virus outbreak, but also from low oil prices due to the decline in demand. Most GCC countries are also pegged to the dollar, which means "the worst risk for the GCC would be low oil prices [and a] strong US dollar", Mr Hardy said.
It will likely be a "rough ride for the rest of 2020" before the dollar weakens significantly and oil prices increase, he said.
The dollar tends to spike during a financial crisis "because tens of trillions of dollars in global financial assets are denominated in dollars", Mr Hardy said. "And when you have a crisis and liquidity goes south, you have everybody scrambling for dollars."
However, the dollar has weakened due to the Federal Reserve's vast and rapid response to the Covid-19 crisis; over a period of six weeks, it took more quantitative easing measures than during the whole of the 2008 global financial crisis.
"Because the Fed has managed to pump so much liquidity into the central bank and the global markets, they managed to turn what was a spiking dollar much lower," Mr Hardy said.
Now the question is whether dollar weakness is set to continue, but "a weak dollar tends to be associated often with quite positive conditions for the global economy", which is a long way from recovery, Mr Hardy said.
While "the total shutdown approach is going to be less likely from here", there will continue to be a "long-term suppression effect on various types of economic activity" as a result of the pandemic, he said.
Gloomy economic data and a rise in coronavirus cases in the US point to a U-shaped recovery, rather than a V-shaped recovery.
"There's been a strong, strong bid coming back in for safe haven US government treasuries all the way up to 30 years, which is to suggest the market is still on a very cautious footing here that tends to be dollar-supportive," Mr Hardy said.
With the massive oil supply overhang, it is difficult for oil prices to go much higher in the near term, for several months at least, he said.
Brent, the international benchmark, could pick up to between $50 to $70 per barrel by the first and second quarters of 2021, as demand increases and supply is balanced, Ole Hansen, Saxo Bank's head of commodity strategy, said in April.
However, Brent crude prices fell 2.48 per cent to $37.77 per barrel and US benchmark West Texas International dropped 3.78 per cent to $34.89 at 5.05pm UAE time due to fears that a second wave of the virus will dampen demand further.
"With our weaker dollar view, especially into 2021 – more so than this year – I would expect oil to be significantly higher in 2021," Mr Hardy said.
info-box
COMPANY PROFILE
Company name: Happy Tenant
Started: January 2019
Co-founders: Joe Moufarrej and Umar Rana
Based: Dubai
Sector: Technology, real-estate
Initial investment: Dh2.5 million
Investors: Self-funded
Total customers: 4,000
if you go
The flights
Etihad and Emirates fly direct to Kolkata from Dh1,504 and Dh1,450 return including taxes, respectively. The flight takes four hours 30 minutes outbound and 5 hours 30 minute returning.
The trains
Numerous trains link Kolkata and Murshidabad but the daily early morning Hazarduari Express (3’ 52”) is the fastest and most convenient; this service also stops in Plassey. The return train departs Murshidabad late afternoon. Though just about feasible as a day trip, staying overnight is recommended.
The hotels
Mursidabad’s hotels are less than modest but Berhampore, 11km south, offers more accommodation and facilities (and the Hazarduari Express also pauses here). Try Hotel The Fame, with an array of rooms from doubles at Rs1,596/Dh90 to a ‘grand presidential suite’ at Rs7,854/Dh443.
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
Vidaamuyarchi
Director: Magizh Thirumeni
Stars: Ajith Kumar, Arjun Sarja, Trisha Krishnan, Regina Cassandra
Rating: 4/5
UAE currency: the story behind the money in your pockets
The specs: 2019 Haval H6
Price, base: Dh69,900
Engine: 2.0-litre turbocharged four-cylinder
Transmission: Seven-speed automatic
Power: 197hp @ 5,500rpm
Torque: 315Nm @ 2,000rpm
Fuel economy, combined: 7.0L / 100km
History's medical milestones
1799 - First small pox vaccine administered
1846 - First public demonstration of anaesthesia in surgery
1861 - Louis Pasteur published his germ theory which proved that bacteria caused diseases
1895 - Discovery of x-rays
1923 - Heart valve surgery performed successfully for first time
1928 - Alexander Fleming discovers penicillin
1953 - Structure of DNA discovered
1952 - First organ transplant - a kidney - takes place
1954 - Clinical trials of birth control pill
1979 - MRI, or magnetic resonance imaging, scanned used to diagnose illness and injury.
1998 - The first adult live-donor liver transplant is carried out
The five pillars of Islam
1. Fasting
2. Prayer
3. Hajj
4. Shahada
5. Zakat
Read more from Aya Iskandarani
The specs
- Engine: 3.9-litre twin-turbo V8
- Power: 640hp
- Torque: 760nm
- On sale: 2026
- Price: Not announced yet
Biography
Her family: She has four sons, aged 29, 27, 25 and 24 and is a grandmother-of-nine
Favourite book: Flashes of Thought by Sheikh Mohammed bin Rashid
Favourite drink: Water
Her hobbies: Reading and volunteer work
Favourite music: Classical music
Her motto: I don't wait, I initiate
War
Director: Siddharth Anand
Cast: Hrithik Roshan, Tiger Shroff, Ashutosh Rana, Vaani Kapoor
Rating: Two out of five stars
The specs: 2018 Honda City
Price, base: From Dh57,000
Engine: 1.5L, in-line four-cylinder
Transmission: Continuously variable transmission
Power: 118hp @ 6,600rpm
Torque: 146Nm @ 4,600rpm
Fuel economy, combined: 5.8L / 100km
Killing of Qassem Suleimani
The specs: 2018 Nissan 370Z Nismo
The specs: 2018 Nissan 370Z Nismo
Price, base / as tested: Dh182,178
Engine: 3.7-litre V6
Power: 350hp @ 7,400rpm
Torque: 374Nm @ 5,200rpm
Transmission: Seven-speed automatic
Fuel consumption, combined: 10.5L / 100km
THREE
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JAPANESE GRAND PRIX INFO
Schedule (All times UAE)
First practice: Friday, 5-6.30am
Second practice: Friday, 9-10.30am
Third practice: Saturday, 7-8am
Qualifying: Saturday, 10-11am
Race: Sunday, 9am-midday
Race venue: Suzuka International Racing Course
Circuit Length: 5.807km
Number of Laps: 53
Watch live: beIN Sports HD
Killing of Qassem Suleimani
UAE currency: the story behind the money in your pockets
Important questions to consider
1. Where on the plane does my pet travel?
There are different types of travel available for pets:
- Manifest cargo
- Excess luggage in the hold
- Excess luggage in the cabin
Each option is safe. The feasibility of each option is based on the size and breed of your pet, the airline they are traveling on and country they are travelling to.
2. What is the difference between my pet traveling as manifest cargo or as excess luggage?
If traveling as manifest cargo, your pet is traveling in the front hold of the plane and can travel with or without you being on the same plane. The cost of your pets travel is based on volumetric weight, in other words, the size of their travel crate.
If traveling as excess luggage, your pet will be in the rear hold of the plane and must be traveling under the ticket of a human passenger. The cost of your pets travel is based on the actual (combined) weight of your pet in their crate.
3. What happens when my pet arrives in the country they are traveling to?
As soon as the flight arrives, your pet will be taken from the plane straight to the airport terminal.
If your pet is traveling as excess luggage, they will taken to the oversized luggage area in the arrival hall. Once you clear passport control, you will be able to collect them at the same time as your normal luggage. As you exit the airport via the ‘something to declare’ customs channel you will be asked to present your pets travel paperwork to the customs official and / or the vet on duty.
If your pet is traveling as manifest cargo, they will be taken to the Animal Reception Centre. There, their documentation will be reviewed by the staff of the ARC to ensure all is in order. At the same time, relevant customs formalities will be completed by staff based at the arriving airport.
4. How long does the travel paperwork and other travel preparations take?
This depends entirely on the location that your pet is traveling to. Your pet relocation compnay will provide you with an accurate timeline of how long the relevant preparations will take and at what point in the process the various steps must be taken.
In some cases they can get your pet ‘travel ready’ in a few days. In others it can be up to six months or more.
5. What vaccinations does my pet need to travel?
Regardless of where your pet is traveling, they will need certain vaccinations. The exact vaccinations they need are entirely dependent on the location they are traveling to. The one vaccination that is mandatory for every country your pet may travel to is a rabies vaccination.
Other vaccinations may also be necessary. These will be advised to you as relevant. In every situation, it is essential to keep your vaccinations current and to not miss a due date, even by one day. To do so could severely hinder your pets travel plans.
Source: Pawsome Pets UAE
10 tips for entry-level job seekers
- Have an up-to-date, professional LinkedIn profile. If you don’t have a LinkedIn account, set one up today. Avoid poor-quality profile pictures with distracting backgrounds. Include a professional summary and begin to grow your network.
- Keep track of the job trends in your sector through the news. Apply for job alerts at your dream organisations and the types of jobs you want – LinkedIn uses AI to share similar relevant jobs based on your selections.
- Double check that you’ve highlighted relevant skills on your resume and LinkedIn profile.
- For most entry-level jobs, your resume will first be filtered by an applicant tracking system for keywords. Look closely at the description of the job you are applying for and mirror the language as much as possible (while being honest and accurate about your skills and experience).
- Keep your CV professional and in a simple format – make sure you tailor your cover letter and application to the company and role.
- Go online and look for details on job specifications for your target position. Make a list of skills required and set yourself some learning goals to tick off all the necessary skills one by one.
- Don’t be afraid to reach outside your immediate friends and family to other acquaintances and let them know you are looking for new opportunities.
- Make sure you’ve set your LinkedIn profile to signal that you are “open to opportunities”. Also be sure to use LinkedIn to search for people who are still actively hiring by searching for those that have the headline “I’m hiring” or “We’re hiring” in their profile.
- Prepare for online interviews using mock interview tools. Even before landing interviews, it can be useful to start practising.
- Be professional and patient. Always be professional with whoever you are interacting with throughout your search process, this will be remembered. You need to be patient, dedicated and not give up on your search. Candidates need to make sure they are following up appropriately for roles they have applied.
Arda Atalay, head of Mena private sector at LinkedIn Talent Solutions, Rudy Bier, managing partner of Kinetic Business Solutions and Ben Kinerman Daltrey, co-founder of KinFitz
UAE currency: the story behind the money in your pockets
