04.05.2015 - China's manufacturing sector once again disappointed investors
The price of euro has stabilized after a decline at the end of the last trading session of the week, which was caused by the strengthening of the US dollar and fixation of positions on the euro, after strong growth in the previous days. Today, the dynamics of the euro will depend on the statistics on the manufacturing PMI and the index of investor confidence in the Eurozone (08:30 GMT). In the United States will be published data on factory orders (14:00 GMT). Investors continue to closely monitor the negotiations between Greece and creditors. We recall that on May 12 Greece should make the next payment on the loan of the IMF and in case of default of the country, the price of the euro will fall sharply. The main event of this week will be the publication of a report on the US labor market on Friday. We maintain a medium-term negative outlook on the euro and expect signals for opening short positions.
The price of the British pound today showed a minor correction after a sharp drop in prices on Friday, which was due to an unexpected deterioration in the manufacturing PMI statistics for the country, which in April fell to 51.9, against the forecast of 54.6. Despite this, the index is above the level of 50.0, indicates the continued growth in the sector. Today in UK is the day of and activity of investors will be reduced. We expect consolidation of prices near current levels in the near future and maintain the medium-term negative view on the British currency.
The Japanese yen fell on Friday amid a stronger US dollar. It is worth noting that from Monday to Wednesday in Japan will be days off and volatility will be reduced due to the absence of Japanese investors on the market. In the medium term the movement of the Japanese yen will continue to depend on the monetary policy of the Bank of Japan, which is ultra-soft and the expectation of rising interest rates by the Fed this year. Our medium-term outlook for the Japanese yen remains negative.
The price of the Australian dollar slowed the fall on the background of positive data on the number of permits issued for construction of new homes in Australia, by 2.8% in March, against an expected decline of 1.7%. On the other hand China's manufacturing PMI, calculated by HSBC fell to 48.9 in April, that is 0.5 worse than analysts' expectations. We recall that China is a major trading partner of Australia and the state of its industry is strongly influenced by the dynamics in commodity prices in the world. Tomorrow is forecasted the increased volatility due to the statement of the Reserve Bank of Australia on monetary policy and the release of the report on the trade balance of the country. Our medium-term outlook for the Australian dollar remains negative and we recommend holding short positions.
The price of the New Zealand dollar showed a strong decline, which accelerated on Friday in connection with the strengthening of the US dollar. Falling Australian currency also contributed to sales of New Zealand currency. Tomorrow night the price volatility will be heightened with the publication of a report on the labor market in the country and until that time, investors will monitor the dynamics of the Australian dollar. We expect a further decline in the prices of the New Zealand dollar, but positive statistics on the labor market can make a difference.