01.12.2015 - Reserve Bank of Australia did not change interest rates
Currency trading and the euro. The price decline of euro has stopped amid expectations of a large number of important events this week and the central of which will be the decision of the ECB on monetary policy. In the case of expansion of quantitative easing program and lowering interest rates on deposits, we will see a continuation of the downward price movement. Today, investor sentiment will be affected by the data on the manufacturing PMI in the Eurozone (09:00 GMT) and the US (15:00 GMT), the unemployment rate in the Eurozone (10:00 GMT) and construction spending in the US (15:00 GMT). We expect increased volatility in prices in the next few days and keep the medium-term negative outlook.
Currency trading and the British pound. The price of the British pound started to correct upwards after reaching the psychologically important 1.50 level. Investors decided to take profits ahead of today's publication of the report of the Bank of England on Financial Stability, statement on the financial policy committee of the Bank of England and the results of stress tests in the United Kingdom (07:00 GMT). Also today, the dynamics of trading will be affected by the statement of the Bank of England Governor Mark Carney (09:00 GMT) and statistics on the manufacturing PMI (09:30 GMT). The current correction may continue in the near future, but our medium-term outlook remains negative.
Currency trading and the Japanese yen. The price of the Japanese yen strengthened today against the US dollar, despite the fact that statistics on manufacturing PMI did not meet analysts' forecasts and was 52.6 against 52.8 expected. The volatility in the coming days will be increased, and we can see a strong price movement in one direction or another. Our medium-term outlook remains negative due to the divergence in monetary policy the Bank of Japan and the Federal Reserve.
Currency trading and the Australian dollar. The price of the Australian dollar resumed the growth today after the RBA's decision to keep interest rates unchanged at 2.0%. In addition, the Australian regulator said about the moderate pace of economic growth amid falling investment in the mining sector of the country. Support for the market was the news on the growth of the manufacturing PMI in November to 52.5, against 50.2 in the previous month. The comparable figure in China fell by 0.2, to 49.6, signaling a further slowdown in the sector. Tomorrow we expect a strong movement of prices in connection with the release of data on GDP growth in Australia. Low inflation in Australia makes it possible to further reduce interest rates. Considering these factors, as well as the expected rise in the US dollar, our medium-term outlook remains negative.
Currency trading and the New Zealand dollar. The price of the New Zealand dollar after a long consolidation could continue to grow. The stimulus for upward movement was the growth of the Australian currency. Despite the general improvement in investor sentiment in New Zealand, is possible the reduction in interest rates of the Reserve Bank of New Zealand on the background of low inflation and the projected growth of the US dollar in the future with high probability will lead to a resumption of the negative dynamics of prices. Our medium-term outlook remains negative and we estimate that the volatility will be high this week.