05.10.2016 - ​Price of euro resumed its growth, despite the strengthening of the dollar

Currency trading and the euro. The price of euro showed growth after on the market appeared speculations about a possible restriction of the program of quantitative easing in the euro area, which many countries use to delay reforms. This fact will support the euro, but at the same time, Fed officials hinted at a high probability of the Fed raising interest rates this year. According to our estimates, such a move is unlikely in November, but in December, we expect an increase in interest rates. Today will be published important news, on service PMI (08:00 GMT) and retail sales in the Eurozone (09:00 GMT), as well as statistics from the US non-manufacturing PMI and the volume of factory orders in the US (14:00 GMT). We forecast a drop in euro prices in the near future and medium term and the growth of volatility is expected on Friday after the release of the US labor market report.

Currency trading and the British pound. The price of the British pound showed decline amid growth of fears of investors concerning the negative impact of the country's exit from the Eurozone. Current improvement of macro statistics in the country is due to the weakening of the British pound and will have a temporary effect. Today, it is worth paying attention to the news on service PMI in the UK (08:30 GMT). According to our forecasts, the price will continue falling in the near future and medium term, and growth is possible only within the correction.

Currency trading and the Japanese yen. The price of the Japanese yen shows a decline against the US dollar due to the increasing likelihood of the Fed raising interest rates in December. We do not expect a decision to tighten monetary policy before the November’s presidential elections in the United States. Additional pressure on the price of the yen had a purchase of euro against sale of the yen. Investors are waiting for the important statistics on US employment on Friday. It is worth noting that the demand for defensive assets may intensify in case of a fall on the stock markets, the probability of which has grown recently.

Currency trading and the Australian dollar. The price of the Australian dollar after the recent fall caused by the strengthening of the US dollar, renewed growth, due to the positive statistics on retail sales in Australia, which rose by 0.4% in August, which is 2 times better than expected. Tomorrow a strong impact on the dynamics of trading will have statistics on the trade balance of the country, which in recent months has led to a weakening of the Australian dollar. After the completion of the current consolidation, we expect a strong price movement. Our medium-term outlook remains negative due to uncertainty on the commodities market and the expected strengthening of the US dollar.

Currency trading and the New Zealand dollar. The price of the New Zealand dollar showed a decrease due to the strengthening of the US dollar. It is worth noting that after a long consolidation, prices began to decline and has overcome the important level of 0.7200. This fact, together with the adverse conditions on the dairy market and the growth of the US dollar is a strong signal to sell. According to our expectation the continuation of further reduction the likelihood has greatly increased, and we maintain a medium-term negative outlook.

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