The Covid-19 outbreak has halted the normal channel of life, people losing their livelihood and income has dwindled over the past eight months all over the world. However, in the tailspin the world has faced, the Forex accounts have witnessed a phenomenal growth over the pandemic-ridden months. Month-on-month growth has been recorded as close as 25-50% while the total volume has expedited at an all-time high of 300% growth. Over the past decade such a phenomenal growth was hardly ever seen since the last record high was a close to 40% which is mere compared to the colossal figure posted on the stage in June 2020.
The developing markets, however, post a lucrative section to invest in since the region has been the biggest contributor to the FX rise: close to 60% being the beneficiary of Europe, Africa and South Asian countries. Safe to say that this trend has been so steep largely due to the investors being ridden with optimism over the volatile prices of many of the commodities that were rendered stagnant over the previous decades. This includes the oil prices, gold valuation and even the real estate market that despite being involved in a price bubble leading to the worst financial crisis of the millennial, still stood relatively steady over the past 11 years.
The FX market is oozing optimism to say anything about the trend which could be directly associated to the unprecedented financial climate and the looming atmosphere of recession and financial crisis pushing people towards adopting a new income stream. As conventional income channels come to a dead stall and people having time and focus to spare towards trading, the large volume of cumulative accounts could be further expected to extrapolate since price volatility and unexpected events both in the trade and world affairs have had a conducive effect on even the layman to dip into the trading cycle: FX market being the coherent choice due to safe commodity and currency investments and quick gains.
Exacting one’s mind towards the milestones achieved this year, be it the plunge of global oil prices to the negative scale of the exchange or the sharp fall and sudden rise of DJI or even the injection of one of the largest stimulus packages in the United States since the infamous financial crisis, this year marks the focal point of risks and opportunities. The prospects of a new vaccine are still trailing to the second quarter of 2021 despite some countries picking up the pace to vaccinate early means the trend in the market is not short term unless a breakthrough is imminent. On the market front, the interest rate crunch with UK expected to nudge the rates in the negative along with global relief to debt financing, traders have a global ticket on both the borrowing and the lending front to turn up abnormal gains. However, reliable brokers are a tough nook to find since the uncertainty also grips the traders regarding investments in the skewed conditions as such. Moreover, with naïve traders entering the market, small scale brokers clustering the exchanges and limited physical interactions due to social distancing protocols are all but exhaustive factors that could easily deteriorate the growing trend and bring about a financial crisis much sooner than expected if not regulated efficiently.
