06.03.2014 - Traders are waiting for Mario Draghi's speech
U.S. stock indexes practically have not changed over yesterday's trading session. Statistics on the labor market in the U.S. was better than in previous period, but did not meet еру forecasts of analysts. Thus, the no-farm unemployment in the U.S. in February increased by 139 thousand, that is 20 thousand worse than the forecast but 12 thousand better than the previous figure. The non-manufacturing PMI in the U.S. fell to 51.6, compared with an expected 53.8. According to the Beige Book, economic activity in the U.S. has grown in during the last period, but was constrained by the cold weather.
Among the statistics published in the euro area, is worth noting the growth of GDP by 0.3%, as expected, growth in retail sales by 1.6%, vs. 0.9%, and the increase of service PMI to 52.6 that is better than the previous estimates of experts 51.7.
Despite the positive statistics from the Eurozone, the quotes of euro continue to consolidate near 1.3730. Today we expect a rise in volatility. Traders expect the ECB's decision on interest rates (12:45 GMT), as well as a press conference of the head of the ECB Mario Draghi (13:30 GMT). Also today is worth paying attention to labor market data (13:30 GMT) and to factory orders in the U.S. (15:00 GMT). We recall that tomorrow will be released the report on unemployment in the United States. We maintain a long-term negative outlook for the euro.
The British pound strengthened yesterday on the background of positive statistics on service PMI, which continues to grow for 14 consecutive months. At the same time traders expect the Bank of England's statement (12:00 GMT) in which the interest rate will be announced, as well as the amount of asset purchases. Despite strong growth in the UK economy, we do not expect the bank to tighten its monetary policy. We maintain a long-term positive outlook. The movement of the pound in the short and long term will depend on the statements of the Bank of England.
The Japanese yen continued its decline, despite the weakening of the U.S. dollar after the release of data on the labor market. The bulls in USD/JPY were supported by growth in sales of the yen against the Australian dollar. At the moment the price is near a strong resistance level and considering a strong growth in the previous days, we expect the correction, after which the upward movement may resume. We maintain long-term and medium-term positive outlook for the pair.
The price AUD/USD showed a strong growth due to positive macro statistics. Thus, the trade surplus in January rose to 1.43 billion, compared with an expected growth of 0.11 billion and 0.59 billion in the previous period. At the same time, retail sales in Australia increased by 1.2% vs. 0 5%. Weakening of the U.S. dollar also contributed to rise of AUD/USD quotations. Despite this, we maintain a long-term negative outlook for the AUD/USD. The price movement in the near future will depend on the data on the unemployment rate in the U.S., which will be released tomorrow.
NZD/USD has strengthened, buoyed by strong data from Australia. Potential for further growth is limited by fears about slowing economy of the main trading partner - China. We maintain a long-term negative outlook for the NZD/USD.
The price of Light Sweet crude oil finally began to decline. The reason for the sales was a report on oil and petroleum products' inventories in the U.S. Thus, oil inventories rose by 1.43 million barrels and distillates by 1.41 million barrels. Warming in North America will reduce oil consumption. In addition to the black gold quotes continue to be under the pressure of the record production volumes in the U.S., as well as a slowdown in the Chinese economy. We keep medium and long term negative outlook for oil prices.
Gold continues to consolidate in the corridor 1330-1344 dollars per troy ounce. After weakening of geopolitical factors, the volatility in gold prices has dropped significantly. Weak growth was driven by the weakening of the U.S. dollar. Increase in volatility is expected tomorrow after the data on unemployment in the United States. We maintain long-term and medium-term positive outlook for gold.