Page 9 - Orient Finance PR Report - March 2024

How Geopolitical Events Shape Global Financial Markets - OneArabia
thereby leading to an appreciation in the value of the currency in the market. Conversely, lower interest rates can result

in a decline in currency value. The value of a currency can be influenced by economic indicators such as GDP growth,
employment data, inflation rates, and manufacturing output. Depending on traders’ perceptions of the state of the

economy, these figures possess the power to swiftly alter the movement of currency pairs.

Political stability has a significant impact on the OTC marketplace. A country’s capacity to draw in foreign investments

and strengthen its currency value may be ascribed to its political stability and implementation of sound economic

policies. Additionally, the difference between a nation’s imports and exports, or trade balance, can impact the value the
share market. A trade surplus tends to make the currency stronger, while a trade deficit might cause the currency to

weaken. Geopolitical events, including wars, elections, or any global conflicts, can cause uncertainties in the OTC

market and financial markets

While a negative news or event might strengthen safe-haven currencies, positive news can encourage increased risk-

taking and higher-yielding currencies. Changes in commodity prices often have an impact on the currencies of countries
that export commodities. For instance, an increase in oil prices can benefit oil-exporting nations as it would bolster their

currencies. The Middle East is home to some of the world's largest oil-producing nations, such as Saudi Arabia, Iraq,

and the UAE. The energy resources of this region have a significant impact on international relations, energy markets,
and global economic and political dynamics.

Furthermore, while recessions or slowdowns in major economies have the immense potential to affect financial markets
and cause risk aversion, broader economic trends, such as the advancement of tourism and infrastructure, have the

potential to accelerate the global economic cycle. Gulf Cooperation Council (GCC) countries have witnessed

tremendous economic growth and modernisation over recent years. For instance, Dubai, Riyadh and Doha have
emerged into prominent global economic cities with its remarkable infrastructure, iconic landmarks, as well as hosting of

significant global events, such as the World Cup 2022, Expo 2020, and COP28. Additionally, it is expected that the

financial industry in the region will continue to grow, and several new OTC trading opportunities will arise as the
Kingdom of Saudi Arabia looks forward to hosting the 2030 Expo.

In the UAE, the number of retail leverage traders has increased significantly in 2023. In the previous year alone, as

many as 18,500 traders have opened their first trades, registering a 9% increase in the number of foreign exchange

(FX) and contracts for difference (CFDs) traders, as stated by a recent Investment Trends report. Currently, there are
around 49,000 leverage traders in the country.

In light of all the aforementioned factors, it is recommended to consider algorithms, technical strategies and other

trading tools into investing strategies. With the help of these technical innovations, investors can swiftly and efficiently
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