13.10.2015 - The foreign exchange market is consolidating at the beginning of the week, which promises to be volatile
Currency trading and the euro. The price of euro stabilized on Monday due to the holiday in the US, which has led to weak activity of investors. Investors are still trying to estimate the probability of the Fed raising interest rates this year and yesterday's statements by Fed officials did not bring clarity on this issue. The Fed will monitor economic indicators in the country and influence of the situation abroad on the American economy. Today, the course of trading will be affected by the data on the index of business sentiment Eurozone (09:00 GMT) and the index of small business optimism in the US (10:00 GMT). The activity will be held back by waiting the release of retail sales data on Wednesday. Our medium-term outlook for the euro remains negative.
Currency trading and the British pound. The price of the British pound continues to consolidate against the background of weak activity of investors in connection with the holiday in the US on Monday. Investors were in no hurry to open new positions before the publication of important statistics on inflation in the United Kingdom (08:30 GMT). In addition, investors' activity will be constrained by the expectation of the release of data on the labor market in the country on Wednesday, which can greatly affect investors' expectations regarding the timing of rising interest rates of the Bank of England that is expected in the first half of 2016. We expect falling prices in the medium term, but in the near future price growth may continue.
Currency trading and the Japanese yen. The price of the Japanese yen has strengthened and continues to consolidate close to previous levels. Reducing the amplitude of price fluctuations indicates strong price movements in the future. Today, Japanese and American investors are returning to the market after a day off on Monday. Negative for the yen was the news of the reduction of the index of consumer confidence in the country to 40.6, which is 1.0worse than the forecast. Support for the Japanese currency is weakening of the US dollar and weak data from China continue to support increased demand for defensive assets. Our medium-term outlook remains negative for the yen against the background of the forecast of new stimulus from the Bank of Japan.
Currency trading and the Australian dollar. The price of the Australian dollar started to correct after strong growth in previous days. The reason for pessimism today was the news of China's trade surplus, a surplus of which rose to 60.3 billion, compared with an expected 46.9 billion, but imports in yuan in September fell by 17.7% against a decline of 14.3% in August. This fact indicates a weakening of demand for commodities, which traditionally have a strong influence on the course of trading. Statistics on the growth of the index of business sentiment in the business community in Australia that grew to 5 to 1 in August, could not change the negative sentiment. Tomorrow, on the dynamics of trading will affect news on consumer confidence in Australia. Our medium-term outlook remains negative, and the fall is likely to continue in the near future.
Currency trading and the New Zealand dollar. The price of the New Zealand dollar corrected downward after the Australian dollar against the backdrop of technical factors and the weak statistics on import in China, which is the main consumer of New Zealand's exports. Falling commodity prices usually has a negative impact on the price of the New Zealand dollar. We expect consolidation of prices near current levels in the near future and maintain the medium-term negative outlook for the New Zealand dollar.