Currency trading and the euro. The price of euro resumed its decline today after yesterday's correction, which was caused by weak data on the US manufacturing PMI, which fell below 50.0 and was 48.6 in November, that is by 0.5 worse than the previous value. It is worth noting that the decline in the indicator below 50.0 points on contraction in the sector. The unemployment rate in the euro area fell by 0.1% to 10.7%. Today, we should pay attention to the statistics on the consumer price index in the euro area (10:00 GMT), which will influence the decision of the ECB on monetary policy on Thursday. In addition, today will be the speech of Fed chairwoman Janet Yellen (13:30 GMT) and its rhetoric may lead to a strong movement on the market. Our medium-term outlook remains negative and we expect strong price movements in the coming weeks.
Currency trading and the British pound. The price of the British pound renewed decline after recent gains, which was caused by the results of stress tests of the Bank of England, according to which 2 of 7 tested banks failed to pass the test, but the regulator has not stated the need to increase capital, which indicates the confidence of the Bank of England and his readiness to problematic situations. At the same time, in the UK manufacturing PMI fell to 52.7 in November, that is 1.0 worse than analysts' forecasts. Today, the dynamics will depend on the news on the construction PMI (09:30 GMT). Our medium-term outlook remains negative due to the expected strengthening of the US dollar.
Currency trading and the Japanese yen. The price of the Japanese yen continues to consolidate amid waiting for new signals about the prospects of raising interest rates of the Fed. Bank of Japan policy is ultra-soft, that together with the expected tightening of monetary policy at the Federal Reserve will lead to a drop in the yen. In addition, the dynamics of the Japanese currency adversely affect the weak demand for Japanese goods abroad and risks associated with the slowdown of the Chinese economy. Our medium-term outlook is negative with a potential fall in the price by 3-5%.
Currency trading and the Australian dollar. The price of the Australian dollar stopped growing despite today publication of statistics on GDP growth in Australia in the third quarter, which compared with the previous period increased by 0.9% against the forecast of 0.7%. Compared with the same period last year, the economy grew by 2.5%. The main contribution to the growth rate was made by the export of commodities, goods and services, as well as an increase in consumer demand and housing construction. Tomorrow, the dynamics of trading will be affected by the news on the trade balance of the country. Prospects for the Australian dollar had improved, but despite this, we maintain a medium-term negative outlook.
Currency trading and the New Zealand dollar. The price of the New Zealand dollar slowed growth despite the publication of statistics on the strong growth of GDP in Australia, whose economy is closely linked with New Zealand’s. The growth of price in recent years is also due to higher prices for dairy products, which is the main export product group of New Zealand. Prospects for the economy of the island country has improved, but given the low inflation, we may see a further decline in interest rates of RNBZ. Our medium-term outlook remains negative due to the projected strengthening of the US dollar.