08.10.2015 - Minutes of the previous Fed meeting will be in the spotlight today
Currency trading and the euro. Price of euro continues to consolidate due to the expectation of today's publication of minutes of the previous meeting of the Fed on monetary policy (18:00 GMT). Yesterday, the support for the euro became weak data on the volume of consumer credit in the United States, which dropped in August to 16.0 billion, compared with an expected 18.8 billion. At the same time growth is constrained by weak statistics on industrial production in Germany, which in August fell by 1.2%, after rising 1.2% in the previous period. The dynamics of trading today will also be affected by the news on the trade balance in Germany (06:00 GMT) and data on the number of initial unemployment claims in the US (12:30 GMT). Our medium-term outlook for the euro remains negative and we expect strong price movement after the current consolidation.
Currency trading and the British pound. The price of the British pound has stabilized after confident growth in previous days on strong statistics on industrial production in the country, which grew by 1.0% in August, that is 0.7% higher than analysts' expectations. Today is forecasted increased volatility after the decision of the Bank of England on interest rates, which according to our estimates will remain unchanged. Also today, will be published the minutes of the previous meeting of the Monetary Policy Committee of the Bank of England (11:00 GMT). According to the average forecast interest rates will be raised in the first half of 2016, but the rhetoric of the representatives of the British regulator can greatly affect the course of trading. So, at 18:00 will be the speech of the Bank of England Governor Mark Carney. Our medium-term outlook for the pound is negative and current growth is likely to continue in the near future.
Currency trading and the Japanese yen. The price of the Japanese yen continues to consolidate and significantly strengthened today after the release of conflicting macroeconomic data, according to which, the volume of new domestic orders for engineering products in August fell by 5.7% against the forecast of growth of 3.3%. On the other hand, the country's balance of payments surplus rose to 1.59 trillion vs. predicted 1.28 trillion. The increase in volatility is expected in the evening after the publication of minutes of the previous meeting of the Federal Reserve. We expect the reduction of price of the Japanese yen in the medium term.
Currency trading and the Australian dollar. The price of the Australian dollar corrected sharply after strong growth in previous days. Support for the Australian currency was higher prices of commodities and the weakening US dollar. It should be noted that earlier the Reserve Bank of Australia decided not to cut interest rates, triggering buy the Australian currency. Our medium-term outlook remains negative and we expect a continuation of the current negative trend in the medium term.
Currency trading and the New Zealand dollar. The price of the New Zealand dollar is corrected downward after the recent sharp rise in prices, which was caused by technical factors and improved investor sentiment regarding the crisis in China caused by the slowdown in the economy and the devaluation of the yuan. We expect a drop in prices in the medium term to the target level at 0.6000 and we expect a further fall in the near future.