The value of Kenyan Shilling has been steadily declining against the US Dollar since June of 2021. Historic performance of the currency indicates that the value can drop even lower. Upcoming general elections that are scheduled to be held on August 9, 2022 could increase the volatility and result in unpredictable outcomes.
In order to protect yourself from high inflation, it’s important to look for ways to diversify your risks. Investing in safer currencies is a great way to withstand the market uncertainty. Forex charts can provide you with better insight into the strengths of certain currencies. Usually major currencies provide a safe haven for those who are interested in protecting their savings from weak national currencies. And there are a various great reasons for it:
- Major currencies are backed by strong economies and their value is more stable.
- Most exchanges occur between Major and Minor pairs, ensuring high liquidity. Which translates into lower spreads.
- There’s a wide amount of information available on major currencies. Including central bank decisions and market analysis.
In addition, you can invest in major, minor and cross pairs like GBP / CHF or CAD / CHF. Just stay away from exotic ones as they’re characterized by high spreads, high volatility and low liquidity.
US Dollar, Japanese Yen, British Pound, Euro and Swiss Franc are among the most traded currencies globally. However, recent events have shown that even the Euro can be susceptible to political and economical challenges. There’s an energy crisis in Europe and while you can buy the currency at its lowest, the future remains unpredictable. There’s a chance of the Euro losing its value further. The British Pound and Euro are closely correlated currencies. At the moment both currencies remain risky to invest in.
Furthermore, Japanese Yen has been in a downtrend against USD recently and it’s best to avoid investing in Yen for now.
USD dollar and Swiss Franc on the other hand provide safe alternatives for investing.
The USA has recently experienced some of the worst inflations recently. To counter the inflation, the Fed is expected to keep the monetary policy tight. Fed interest rate decisions influence the currency prices in various ways. The higher the rates, the less incentive to borrow money from the banks, which results in stronger currency. In addition, traders and investors base their investments on Fed decisions, making the outcome a self fulfilling prophecy. USD is expected to remain very stable compared to other major currencies.
