05.12.2014 - ​Today is expected the increase in volatility after the release of data on US labor market

The price of euro yesterday showed strong growth after the speech of the ECB President Mario Draghi. Despite the fact that the ECB interest rates remained unchanged, the reason for the growth were the words of Mr. Draghi about that at the beginning of the next year, the ECB will decide on the start of measures to stimulate the economy, which should help to deal with low inflation. Also yesterday was noted that the cause of slowing inflation in recent years was the fall in oil prices. Today the dynamics of trading will depend on GDP data for the euro area (10:00 GMT), statistics on the labor market (13:30 GMT) and factory orders in the US (15:00 GMT). We maintain our medium-term negative outlook for the euro and we expect increased volatility today.

The British pound yesterday showed low volatility for trading and continued to decline. We recall that the Bank of England kept interest rates at a record low 0.5%. Minutes of yesterday's meeting will be published on December 17. At the last meeting 2 of 9 members of the Monetary Policy Committee voted to raise interest rates. Today, we expect an increase in volatility after the release of a report on the labor market in the US (13:30 GMT). In addition it is worth paying attention to data on inflation expectations in the UK in Q3 (09:30 GMT). Given the current consolidation, we recommend to wait for the signals to open new positions.

The price of the Japanese yen continues to consolidate near seven-year lows. The weakening of the Japanese currency is due to positive expectations about the US labor market statistics which will be published today. In addition, a stable negative trend persists due to the recession in Japan and the steady growth in the United States. The divergence in monetary policy between the two countries is the main reason for the fall in the price. We maintain our medium-term negative outlook, but do not exclude the slow fall in the near future.

The price of the Australian dollar continues a gradual decline despite the positive statistics on retail sales, which increased by 0.4% in November and a lower trade deficit, which in October totaled 1.32 billion compared with an expected 1.85 billion. Investors continue to sell the Australian currency due to weak GDP growth in the 3rd quarter, which rose by only 0.3% against the expected 0.7%. We maintain our medium-term negative outlook and recommend to monitor the statistics on the labor market in the US (13:30 GMT), the publication of which will lead to increased volatility.

The New Zealand dollar showed a jump in prices, but continued to move within a downtrend. Quotes of the national currency remained under the pressure of weak trade balance data, due to the low prices of export goods. The main risk to the economy is the slowing Chinese economy. We maintain our medium-term negative outlook and recommend holding short positions on the New Zealand dollar.

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