09.08.2016 - The growth of the dollar continues to put pressure on other world currencies
Currency trading and the euro. Price of euro showed decline amid a stronger US dollar in relation to the publication of positive statistics on the US labor market, which increased the likelihood of the Fed raising interest rates this year. It should be noted that the data on the index of investor confidence in the euro area that was released yesterday that rose to 4.2 in August from 1.7 in the previous period. Today, investor sentiment will affect the US data on wholesale inventories (14:00 GMT) and the trade balance in Germany (06:00 GMT). Our medium-term outlook remains negative and the current decline is likely to continue in the near future.
Currency trading and the British pound. The price of the British pound continued to decline against the strengthening of the US dollar, as well as the negative impact of the Bank of England's recent decline in interest rates and the asset purchasing program expansion, which is caused by the need to stimulate the economy amid the negative effects of the country's exit from the EU. UK central bank may continue easing monetary policy this year and speculation about the country's exit from the EU will be the effects of pressure on the pound. Today, volatility is increased in connection with the publication of important data on industrial production in the country (08:30 GMT). Our medium-term outlook remains negative.
Currency trading and the Japanese yen. The price of the Japanese Yen continued its decline against the US dollar, due to increased probability of higher interest rates of the US Federal Reserve and reduced demand for defensive assets like the yen due to the increase in risk appetite. Today, the dynamics of trading will affect the data on the volume of orders for engineering equipment in Japan (06:00 GMT). Tomorrow will be published statistics on the volume of domestic orders for engineering products. We maintain our medium-term negative outlook on the Japanese yen against the background of the divergence of monetary policy of the Fed and the Bank of Japan, and we expect a continuation of the current decline in the near future.
Currency trading and the Australian dollar. The price of the Australian dollar fell against the background of decline of the index business sentiment from 5 to 4 in July. In addition, the growth of long-term risks for the country and low commodity prices will put pressure on the price of the Australian dollar in the future and may lead to the continuation of monetary policy easing of the Reserve Bank of Australia before the end of the year. Tomorrow we should pay attention to the statistics on the index of consumer confidence in Australia. Our medium-term outlook remains negative and we expect a decrease in the near future.
Currency trading and the New Zealand dollar. The price of the New Zealand dollar continued to decline against the strengthening of the US dollar in relation to the expectation of the statement of the Reserve Bank of New Zealand on monetary policy, which will be issued on Wednesday night. Given the recent reduction in interest rates by the central bank of Australia, we expect a similar move by the New Zealand regulator. Our medium-term outlook remains negative and we expect continued decline in the near future.