06.11.2015 - Statistics on the US labor market will lead to a strong movement on the market
Currency trading and the euro. The price of euro is consolidates ahead of today's publication of important statistics on the labor market in the US in October (13:30 GMT). According to our forecasts, the figures in the US will be better than the previous ones, and analysts' forecasts, it will lead to a drop in price of the euro. Yesterday, the negative impact on the course of trading will have the European Commission forecasts for GDP growth in the euro area, which in 2015 had increased by 0.1% to 1.6%, and in 2016 dropped by 0.1% to 1.8%. Today, we should also pay attention to the statistics on industrial production in Germany (07:00 GMT). Today, we are forecasting an increase in volatility and the more likely scenario is a drop in price of the euro. Our medium-term outlook remains negative.
Currency trading and the British pound. The price of the British pound started to fall sharply after the publication of forecasts for economic growth in the UK which were declined in 2015 and 2016 by 0.1% to 2.7% and 2.5%, respectively. In addition, the consumer price index in the first half of next year will remain below 1.0%, which excludes the possibility of raising interest rates of the Bank of England. The forecast for inflation in 2015 was reduced to 0.1% versus 0.3% previously. In this regard, we expect continuation of falling prices in the near future, which may intensify today after the publication of data on the labor market in the US (13:30 GMT). Strong influence on the course of trading will also have important news on the trade balance and industrial production in the United Kingdom (09:30 GMT). Our medium-term outlook remains negative.
Currency trading and the Japanese yen. The price of the Japanese yen continued to decline amid expectations of strong statistics on the US labor market, which will increase the probability of the Fed raising interest rates in December. Today the head of the Bank of Japan made a speech in which he noted the negative impact of a slowdown in developed countries on Japan's economy and noted that the main risk for the economy is slowing growth in China. At the same time Haruhiko Kuroda said the willingness to adjust monetary policy to achieve the inflation target of 2.0%. We expect increased volatility in prices today and maintain the medium-term negative outlook on the yen.
Currency trading and the Australian dollar. The price of the Australian dollar is under the pressure from a stronger US dollar, but it is worth mentioning the publication of forecasts of the Reserve Bank of Australia on GDP growth and inflation in the country. Thus, the forecast of expansion of the economy in 2015 was reduced to 2.25%, which is 0.25% less than the previous forecast. In addition, inflation in the country at the end of 2015 will be 1.75%, compared with previous estimates of 2.5%. Lower inflation increases the likelihood of the use of additional softening of monetary policy by the Australian regulator. Our medium-term outlook remains negative and we recommend holding short positions.
Currency trading and the New Zealand dollar. The price of the New Zealand dollar continues to decline amid increasing investor confidence in the Federal Reserve raising interest rates and low inflation in New Zealand, which stimulates the lower interest rates of the Reserve Bank of New Zealand. In addition, the price is under the negative impact of falling commodity prices. Our medium-term outlook remains negative and we recommend holding short positions with the targets on 0,60-0,62.