Pros and Cons of Working with Regulated Vs Unregulated Brokers 0 (0)

<p class=“MsoNormal“>The global forex market averages daily trading volumes of over $6 trillion.
It is the largest financial market in the world, with plenty of opportunities
around the clock, and it offers easy accessibility for any new or experienced
investor. </p><p class=“MsoNormal“>To get exposed to this market, you need to sign up with an online forex
broker. Investing is generally a decision-making activity, and choosing a
broker is one decision you need to get right. </p><p class=“MsoNormal“>Brokers provide you with access to the global financial markets. Some of
their offerings could include access to a trading platform (for buying and
selling global financial assets), charting tools, educational resources, and
practical trading tools. </p><p class=“MsoNormal“>In essence, a broker is your partner as you seek to explore the markets.
Forex is a volatile market, so you need a partner that will provide you with
maximum peace of mind.</p><p class=“MsoNormal“>Forex Regulation</p><p class=“MsoNormal“>Forex is a global decentralized market, and this inherently makes it
difficult for a single body to oversee the entire industry. Depending on your
jurisdiction, there is a relevant regulatory body that sets the standards and
guidelines that online brokers must comply with. </p><p class=“MsoNormal“>In the financial world, the purpose of regulation is to protect
investors from fraud or any other undisclosed risk. But regulation varies from
jurisdiction to jurisdiction, with some bodies considered to be stricter on
their rules and guidelines, whereas others are very lax. Some of the major
regulatory bodies include the US’s CFTC, Cyprus’ CySEC, Australia’s ASIC,
Israel’s ISA, and Japan’s FSA. </p><p class=“MsoNormal“><a target=“_blank“ href=“https://www.avatrade.com/“ target=“_blank“ rel=“follow“>Forex brokers, such as AvaTrade</a>, are licensed and
authorized in multiple, strict jurisdictions. Generally, stricter jurisdictions
provide more client protection compared to the less strict ones. </p><p class=“MsoNormal“>To earn the trust and credibility of both local and international
customers, reputable brokers pursue regulation in stricter jurisdictions where
failure to comply to set guidelines can be very costly.</p><p class=“MsoNormal“>There are other offshore locations where regulatory bodies are
considered to be more lenient or rather very lax in implementing their rules. </p><p class=“MsoNormal“>While such jurisdictions make it easy for newer brokerage firms to
emerge, they may also not provide the much-needed peace of mind that investors
require. </p><p class=“MsoNormal“>Why Are Some Forex
Brokers Unregulated?</p><p class=“MsoNormal“>There are also plenty of brokers that are not regulated. Regulation is
generally considered the first sign of a genuine broker. </p><p class=“MsoNormal“>Not all unregulated brokers are frauds, but the lack of oversight and
accountability makes it easy for some of them to engage in unethical
activities. Some of the reasons some online brokers operate without any license
could include undercapitalization, high cost of compliance, and tax avoidance
measures. </p><p class=“MsoNormal“>Pros and Cons of
Regulated Brokers </p><p class=“MsoNormal“>Pros</p><p class=“MsoNormal“>Safety of Funds</p><p class=“MsoNormal“>One of the major conditions for regulation is protecting investors’
funds. Regulatory bodies typically require brokers to hold client funds in
segregated bank accounts, and never use the funds at any given time for their
own company operations. </p><p class=“MsoNormal“>Furthermore, in some jurisdictions, investor funds must be insured so as
to guarantee reimbursement in case a company becomes insolvent. </p><p>Transparent Services</p><p class=“MsoNormal“>Regulated brokers tend to provide honest and transparent services
because there is a body that oversights their operations. Some of the biggest
forex scams include identity theft, platform manipulation, and dishonest
promotions. </p><p class=“MsoNormal“>Regulatory agencies perform random checks on the operations of companies
under their jurisdiction to ensure that they remain honest and transparent in
all their operations and service offering at all times. </p><p class=“MsoNormal“>Favourable Dispute Resolution</p><p class=“MsoNormal“>One of the best reasons to trade with a regulated broker is that you
will be guaranteed fair resolution in the event that any dispute arises. </p><p class=“MsoNormal“>Regulatory bodies are mandated to protect investors, which means that
you can expect just treatment in case you ever want to resolve any issue that
arises between you and the broker. </p><p class=“MsoNormal“>Cons</p><p class=“MsoNormal“>Limited Choice</p><p class=“MsoNormal“>There is practically no disadvantage to trading with a regulated broker.
Still, adding regulation as a filter can limit your choice of available
brokers, trading instruments, such as synthetic indices, as well as trading
conditions, such as much higher leverage. </p><p class=“MsoNormal“>Pros and Cons of
Unregulated Brokers </p><p class=“MsoNormal“>Pros</p><p class=“MsoNormal“>Plenty of Bonuses</p><p class=“MsoNormal“>Regulatory compliance is a huge cost for brokers. Additionally, most
unregulated brokers tend to be new companies focused on attracting new clients.
</p><p class=“MsoNormal“>These reasons can result in a huge budget for marketing, which will
translate to generous bonuses and promotions for both new and existing
customers.</p><p class=“MsoNormal“>Easy Accessibility</p><p class=“MsoNormal“>Unregulated brokers typically place little restrictions on accessing
their services. No matter your location or circumstances, you can easily sign
up with them and start trading online. </p><p class=“MsoNormal“>For instance, some countries do not permit online trading or have placed
strict laws on how it should be conducted within their jurisdictions. If you
reside in such locations, unregulated brokers can provide easy access to the
world of online financial assets trading. </p><p class=“MsoNormal“>Attractive Trading Conditions</p><p class=“MsoNormal“>Some unregulated brokers are able to provide beneficial trading
conditions such as high leverage and diverse trading instruments such as
synthetic indices. Investors who need such conditions might prefer to trade
with an unregulated broker. </p><p class=“MsoNormal“>Cons</p><p class=“MsoNormal“>High Risk</p><p class=“MsoNormal“>When you trade with an unregulated broker, you are basically dealing
with a company that is not accountable to anyone or any entity. They do not
operate according to any set of rules or guidelines, and there is no guarantee
that your funds are kept safe or that even your confidential information is
secure. </p><p class=“MsoNormal“>Since no one is overseeing and regulating their operations, there is no
way to figure out whether the intentions of the company are genuine or shady. </p><p class=“MsoNormal“>These types of brokers y can easily manipulate their platforms so that
investors easily lose their trade positions or they could even run dishonest
promotions that are merely designed to rip investors off rather than to be
redeemable. </p><p class=“MsoNormal“>Unfair Dispute Resolution</p><p class=“MsoNormal“>When you have a dispute with a regulated broker, the relevant regulatory
agency will act as the mediator. In contrast, if you have a dispute with an
unregulated broker, the company will act as both the defendant and judge. The
lack of any just recourse means that you will not be guaranteed any fair judgment.
</p><p class=“MsoNormal“>Regulation is an important consideration for any investor. A good broker
will ensure that you will have the best environment so that you can trade with
maximum peace of mind. The first sign of a potential bad broker is the lack of
regulation. </p><p class=“MsoNormal“>Nevertheless, it is important to assess the type of regulation that your
preferred broker possesses. Achieving multiple regulations in top jurisdictions
such as Japan, the US, Israel, and Australia can be a good sign of a safe and
trustworthy online CFDs and forex broker. </p>

This article was written by ForexLive at www.forexlive.com.

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BOE completes sale of £19 billion emergency bond purchases 0 (0)

<p style=““ class=“text-align-justify“>If you recall, the panic was caused by the whole mini-budget fiasco involving Liz Truss and Kwasi Kwarteng. The BOE now says that it has completely unwound the £19.3 billion worth of long-dated and index-linked gilts, which was bought during that period.</p><p style=““ class=“text-align-justify“>This comes after another round of £7 billion sales via its regular operations earlier this week, before selling off the small residual amount through bilateral sales today.</p>

This article was written by Justin Low at www.forexlive.com.

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Japanese yen still the main mover so far today 0 (0)

<p style=““ class=“text-align-justify“>The dollar is mostly steady as major currencies aren’t showing much appetite in European trading so far. That is within reason considering that market players are all eyeing the US CPI data later today before firming up any convictions. But the yen is a notable mover, with USD/JPY being down 1% on the day now to 131.00 as speculative bets mount on the currency ahead of the BOJ policy meeting next week.</p><p style=““ class=“text-align-justify“>This comes after the earlier report <a target=“_blank“ href=“https://www.forexlive.com/centralbank/report-the-boj-will-review-the-side-effects-of-easy-policy-next-week-20230111/“ target=“_blank“ rel=“follow“>here</a>, suggesting that policymakers are set to review the side effects of its easy policy.</p><p style=““ class=“text-align-justify“>The timing of the report makes it tricky to navigate through the pair, as the bond market, dollar and risk sentiment will also factor into play once markets get to the inflation numbers later today. But that won’t be the end of it for USD/JPY, as traders will also then have to consider BOJ risks going into next week.</p><p style=““ class=“text-align-justify“>This feels a bit like a litmus test for the yen and it seems like traders are slowly erring towards the BOJ potentially signaling more intent to move away from its current policy stance.</p><p style=““ class=“text-align-justify“>When you take a look at the Japanese bond market, the supposed dysfunction that the central bank wanted to correct in December arguably hasn’t gotten any better. 10-year yields are pinned at the limit of 0.50% since the end of last week and the BOJ has had to keep stepping in with unlimited bond buying (even at 2-year and 5-year bonds) to maintain order.</p><p style=““ class=“text-align-justify“>That said, this is not to say that the BOJ will surely deliver something for traders or yen bulls to get excited about next week. If anything else, I reckon it could be the other way around where the central bank would disappoint those hoping for them to take further steps away from its current easy policy stance.</p><p style=““ class=“text-align-justify“>However, in the bigger picture, that will very much just be a light setback as there have been plenty of developments suggesting that Japan is slowly pivoting towards a fight against inflation. The trade here to me is not to bank on a sudden major change by the BOJ but instead keep patient as the cog wheels start to turn.</p><p style=““ class=“text-align-justify“>In the case of <a target=“_blank“ href=“https://www.forexlive.com/terms/u/usd-jpy/“ target=“_blank“ id=“54ffc0de-9a7c-4a70-9e2e-73d5d9b2bfee_3″ class=“terms__main-term“>USD/JPY</a>, the more immediate picture sees key technical support and resistance defined by 130.00 and 134.50 to 135.00 respectively:</p><p style=““ class=“text-align-justify“>It will require a break on either side to really set off any extensive moves in the pair next.</p>

This article was written by Justin Low at www.forexlive.com.

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Headline inflation expected to fall to 2% target in 2H 2025 – ECB economic bulletin 0 (0)

<ul><li style=““ class=“text-align-justify“>Inflation is expected to decline from an average of 8.4% in 2022 to 6.3% in 2023</li><li style=““ class=“text-align-justify“>Inflation is then expected to decline to an average of 3.4% in 2024 and of 2.3% in 2025</li><li style=““ class=“text-align-justify“>Headline inflation is expected to fall to the ECB’s medium-term inflation target of 2% in the second half of 2025</li><li style=““ class=“text-align-justify“>But HICP inflation excluding energy and food will remain above 2% throughout the horizon</li><li style=““ class=“text-align-justify“>Risks to the economic growth outlook are on the downside, especially in the near-term</li><li style=““ class=“text-align-justify“>The risks to the inflation outlook are primarily on the upside</li><li style=““ class=“text-align-justify“>Tighter financing conditions would mitigate the build-up of financial vulnerabilities and lower tail risks to <a target=“_blank“ href=“https://www.forexlive.com/terms/i/inflation/“ target=“_blank“ id=“ad51a5a2-1afc-4f42-9e62-ea6faf6f90fa_7″ class=“terms__main-term“>inflation</a> over the medium-term</li><li style=““ class=“text-align-justify“>Interest rates will still have to rise significantly at a steady pace to reach levels that are sufficiently restrictive to ensure a timely return of inflation to the 2% medium-term target</li><li style=““ class=“text-align-justify“><a target=“_blank“ href=“https://www.ecb.europa.eu/pub/economic-bulletin/html/eb202208.en.html“ target=“_blank“ rel=“nofollow“>Full release</a></li></ul><p style=““ class=“text-align-justify“>There’s nothing new here as this is mostly a capsule of views held by the ECB and policymakers have put out such remarks over the course of the past few months already.</p>

This article was written by Justin Low at www.forexlive.com.

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China GDP growth seen rebounding to 4.9% next year – poll 0 (0)

<ul><li>2022 GDP growth seen at 2.8% (previously 3.2% in October)</li><li>Q4 2022 GDP growth seen at 1.8% y/y, marking a drop from 3.9% in Q3</li><li>2023 GDP growth seen at 4.9% (previously 5.0%)</li></ul><p style=““ class=“text-align-justify“>Economists see China’s economic growth rebounding modestly next year before steadying in 2024 (growing by 5.0%) with more stimulus on the cards. Here’s a couple of notes from those polled:</p><p style=““ class=“text-align-justify“>“We expect economic activities and consumption to rebound strongly from March-April onwards, helped by post-COVID re-opening and release of excess savings. (But) the lack of large-scale income and consumption stimulus will likely limit the rebound“. — UBS</p><p style=““ class=“text-align-justify“>“Economic policy would turn more supportive in 2023. We expect 11-12% credit growth in 2023 vs 9.6% in 2022, thanks to the window guidance on banks and the improved credit demand. Fiscal policy could also turn more expansionary with a record quota for local government special bonds.“ — Macquarie</p><p style=““ class=“text-align-justify“>In terms of inflation forecasts, the poll showed that consumer inflation in China is likely to rise to 2.3% next year before steadying in 2024.</p>

This article was written by Justin Low at www.forexlive.com.

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