03.04.2015 - The dynamics of the dollar will depend on the data on the labor market in the US
The price of euro corrected upwards before the long weekend in connection with the celebration of Easter. Despite the positive statistics on the number of unemployment claims, which dropped to 268 thousand, compared with an expected 286 thousand, and factory orders rise by 0.2%, investors decided to fix positions in relation to the expectation of the release of statistics on the labor market today in the US (12:30 GMT). Improvement in the US labor market will be the basis for the Fed raising interest rates in June, which will lead to further strengthening of the dollar. In most countries in the Eurozone is a day off. We maintain our medium-term negative outlook for the euro and forecast the increase in volatility today.
The price of the British Pound continues to move near the level of 1.4800. The negative on reduction of construction PMI to 57.8, against a forecast of 59.7 was offset by expectations of improving the situation in the sector and the weakening of the US dollar. Today in the UK is a day off and the course of trading will be affected by the labor market data in the US (12:30 GMT). We expect a further fall in prices of the British pound, but its potential decreased.
The price of the Japanese yen continues to move near the previous close levels. Investors did not rush to open new positions ahead of today's publication of statistics on the US labor market. The course of trading on Monday will depend on news on the index of leading economic indicators in Japan. In the near future the price movement will depend on analysts' expectations on future of US monetary policy. Our medium-term outlook for the yen remains negative.
Australian dollar's price corrected upwards amid the weakening of the US dollar before the publication of statistics on the US labor market. Negative for investors was the data on trade balance of Australia, the deficit of which in February rose to 1.26 billion in February, against 1.00 billion in January. Analysts predict a decrease in the interest rate of the Reserve Bank of Australia on Tuesday, to support economic growth in the country. This step will lead to a drop in prices of the Australian currency. We maintain our medium-term negative outlook and recommend holding short positions.
The price of the New Zealand dollar continues to rise gradually against the background of correction of the US dollar. Increased volatility in prices is expected today after the release of a report on the labor market in the US (12:30 GMT). Next week, a strong influence on the course of trading will have the dynamics of the Australian currency. We predict a decrease in quotations of the New Zealand dollar in the near future, but for the medium-term we need additional signals.