11.02.2016 - The dollar fell after a speech by Janet Yellen
Currency trading and the euro. The price of euro after yesterday's increased volatility caused by the speech of the Federal Reserve Janet Yellen, returned to the local maximums. So, Mrs. Yellen’s rhetoric was dovish, and a decrease in the average interest rate forecasts to 1.4% this year and 2.4% in 2017 had a negative impact on the dynamics of the US dollar. It is worth noting that according to the head of the Fed, a strong dollar will more quickly improve the economic situation in developed countries, which will allow the central banks of the Eurozone and Japan start tightening policy earlier. Today, the dynamics of trading will affect the statistics on unemployment claims in the US (13:30 GMT), as well as the speech of the Fed (15:00 GMT). Tomorrow will be published statistics on retail sales in the US. Our medium-term outlook for the euro remains negative.
Currency trading and the British pound. The price of the British pound continued to rise on the weakening of the US dollar after the statement of the head of the Fed in Congress. It should be noted that this factor was able to neutralize the effect of negative statistics on industrial production, and the volume of which showed the largest decline in more than three years, and fell by 1.1%, against an expected decline of 0.1%. Tomorrow will be published data on production in the construction sector. In the near future the dynamics of prices will depend on the movement of the US dollar. According to our estimates, the current growth can continue, but soon it will be replaced by the fall. Our medium-term outlook remains negative.
Currency trading and the Japanese yen. The price of the Japanese yen continued to rise against the backdrop of continued purchases of defensive assets, due to the fall on the stock and commodity markets. In addition, Yellen's rhetoric during yesterday's speech in Congress was dovish and despite the likely increase in US interest rates, financial conditions necessary for this step have deteriorated. Today in Japan is the day off. Our medium-term outlook remains negative for the yen but price growth may continue in the near future.
Currency trading and the Australian dollar. The price of the Australian dollar showed a slight increase amid the weakening of the US dollar, but the negative dynamics on commodity markets has not given opportunities to continue to grow. It should be noted that consumer inflation expectations in Australia, which are publishes by the Melbourne University showed an increase in this index by 3.6% over the next 12 months, this indicator was 0.4% less than December's figure, which is negative for the Australian currency. Our medium-term outlook remains negative, despite the possibility of a limited increase in the near future.
Currency trading and the New Zealand dollar. The price of the New Zealand dollar shows moderate growth due to the weakening of the US dollar, as well as the publication of positive statistics on the index of business sentiment in the manufacturing sector of the industry in New Zealand, which in January rose to 57.9, against 57.0 in the previous month. The potential for further growth is limited and we expect the resumption of the negative dynamics in the near future.