13.07.2016 - The Japanese yen has declined in recent days
Currency trading and the euro. Price of euro showed little change, but the appetite for risk has increased on the market. It should be noted that experts predict a launch of additional stimulus from the Eurozone and UK central banks to support the economy in the region after it was decided to withdraw Britain from the EU. Today, it is worth paying attention to the publication of the Beige Book, but the central event of the week will be the release of the data on retail sales and inflation in the US. We expect a continuation of the negative dynamics of the euro price in the near future and medium term.
Currency trading and the British pound. The price of the British pound rose after it became clear that the next prime minister will be Theresa May, who supported the preservation of the country within the EU. This fact has led to a decrease in fears on the market and as a result of fixing short positions, we saw a strong upward movement. Investors also are waiting for tomorrow's decision by the Bank of England on monetary policy. In case of lowering the interest rate or a hint of such a move in the near future, we expect the resumption of the negative dynamics of the British currency. Our medium-term outlook also remains negative.
Currency trading and the Japanese yen. The price of the Japanese yen continued to rise due to the fixation of positions, as well as the expectation of additional measures to stimulate the economy, which has traditionally had a negative impact on the Japanese currency. In addition, the demand for defensive assets decreased in connection with the decision on a new prime minister in the UK. Industrial output fell by 2.6% in May against the forecast of decline by 2.2%. Investors are waiting for the publication of important statistics on the growth of China's GDP in the second quarter. Our medium-term outlook remains negative.
Currency trading and the Australian dollar. The price of the Australian dollar started to correct downward after strong growth earlier. Improving the situation on the commodities market was the reason for the recent growth, but at the same time traders are waiting for the publication of data on China's trade surplus, which is a major buyer of Australian commodities. The pressure on the price also provided data on the index of consumer confidence in Australia, which fell by 3.0% in July, against a decline of 1.0% in the previous month. Tomorrow will be released the important labor market data in Australia, which traditionally leads to a strong increase in volatility. Our medium-term outlook remains negative.
Currency trading and the New Zealand dollar. The price of the New Zealand dollar showed a decrease within the correction after the strong growth. Investors are waiting for the publication of important statistics on trade in China today. In addition, volatility may rise after the publication of data on the index of business sentiment in the manufacturing sector of the country (22:30 GMT). Given the potential for monetary easing from the RBNZ and the expected strengthening of the US dollar, we keep a negative medium-term outlook for the New Zealand currency.