13.01.2016 - News from China improved the mood of investors on the market

Currency trading and the euro. The price of euro continued to decline against the general negative trend of the euro and the strengthening of the US dollar, against the background of positive news from China, where the regulator intervened to resolve the difference between the price of the yuan in Shanghai and Hong Kong. In addition, the positive trade balance in China has reduced concerns about the situation in the country. Today, the course of trading will affect the data on the volume of industrial production in the Eurozone (10:00 GMT) and publication of the Beige Book in the US (19:00 GMT). Our medium-term outlook for the euro remains negative.

Currency trading and the British pound. The price of the British pound continued to decline confidently and negative trend accelerated after was published statistics on the volume of industrial production in the country, which fell in November by 0.7%, against a background of reducing the production of oil and gas in the North Sea and the decline in the manufacturing sector. Analysts have a negative outlook for the British currency due to the uncertainty regarding the future referendum on the country's exit from the Eurozone. Our medium-term outlook for the British pound remains negative.

Currency trading and the Japanese yen. The price of the Japanese yen decreases against strengthening of the US dollar and positive news from China, according to which has improved the trade balance and the People's Bank of China intervened in Hong Kong, to equalize the exchange rate of yuan in mainland China and offshore market. This fact reduces the tension on the markets and the demand for defensive assets decreases. Tomorrow will be published statistics on the volume of orders for engineering equipment in Japan. We maintain a medium-term negative outlook on the yen and with a high probability forecast its fall in the near future.

Currency trading and the Australian dollar. The price of the Australian dollar is rising today against the background of positive statistics on the trade balance of China, where exports rose in December by 2.3%, compared with an expected decline of 8.0%. As a result, the trade surplus totaled 60.1 billion dollars against 52.2 billion dollars forecast. At the same time, falling of oil restrains the growth of the Australian currency, which is highly dependent on commodity markets. Tomorrow will be published statistics on the labor market in Australia, which previously supported the demand for the Australian currency. We maintain a negative medium-term outlook for the Australian dollar, despite the possible continuation of the correction.

Currency trading and the New Zealand dollar. The price of the New Zealand dollar rose today due to positive news from China, but the strengthening of the US dollar continues to restrain the growth of the New Zealand dollar. Low inflation may lead to continued decline in interest rates by the Reserve Bank of New Zealand. According to our estimates, after the completion of the current correction, the price decline resumes. Our medium-term view remains pessimistic.

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