01.09.2016 - The activity will decline before a report on US employment
Currency trading and the euro. The price of euro continues to decline against the background of the probability of the Fed raising interest rates. The negative for the euro was the publication of statistics on the number of jobs in the US private sector by ADP, that increased by 177 thousand in August against the forecast of 174 thousand. Today, the dynamics of trading will affect the news on the manufacturing PMI in the Eurozone (08:00 GMT) and the US (14:00 GMT). We also should pay attention to the statistics on the US construction spending (14:00 GMT), which is a key indicator for the economy. Investors today will deter the expectation of tomorrow's publication of statistics on the labor market in the US in August, which greatly affects expectations about the timing of the Fed raising interest rates. Our medium-term outlook for the euro remains negative and we expect a decrease in the near future.
Currency trading and the British pound. The price of the British pound is consolidating after the recent correction within the negative trend. It is worth noting that the positive for the British currency was the publication of data on the index of house prices in the UK, which grew by 0.6% in August, despite the expected decline of 0.1%. Today, the central event of the day will be the publication of the report on the manufacturing PMI in the UK (08:30 GMT). Strong movements are expected tomorrow after the publication of important news on the US labor market. Our medium-term outlook for the British pound remains negative.
Currency trading and the Japanese yen. The price of the Japanese yen significantly strengthened today after a strong decrease in the previous days, which was due to fixation of positions ahead of tomorrow's publication of important data in the US. News on reducing manufacturing PMI in August by 0.1 to 49.5 could not affect the mood of investors. Tomorrow volatility will grow strongly under the influence of statistics from the US, but little impact on the course of trading may have news on consumer confidence in Japan. Our medium-term outlook for the yen is a negative.
Currency trading and the Australian dollar. The price of the Australian dollar has corrected against the background of short-covering after recent decline. It is worth noting that the decline in oil prices will have a negative impact on the dynamics of the Australian currency, which is traditionally highly dependent on the situation on the commodity markets. Today was published weak statistics on the manufacturing PMI, which fell in August to 46.9, against 56.4 in the previous period. The same figure in China rose to 50.4, which is 0.5 better than expected. We forecast a drop in the near future and medium term.
Currency trading and the New Zealand dollar. The price of the New Zealand dollar rose slightly within the correction after the Australian currency. It is worth noting that earlier the Reserve Bank of New Zealand lowered interest rates to 0.25% and announced the possible continuation of monetary easing, which, together with the expected rise in interest rates of the Fed this year will lead to a drop in prices of the New Zealand dollar. Our medium-term outlook remains negative and we expect a decrease in the near future.