14.04.2015 - A further fall in the yen in the opinion of Abe’s advisor is unreasonable
The price of euro continues to consolidate near the level of 1.0600 amid uncertainty regarding Greece's negotiations with creditors and further steps of the Fed on raising interest rates. At the same time, investors are afraid of the elections in Greece, which could lead to a confident victory of party Syriza, which can be a cause for withdrawal of Greece from the Eurozone. Today, the course of trading will be affected by the data on industrial production in the euro area (09:00 GMT), retail sales and producer price index in the US (12:30 GMT). Our medium-term outlook for the euro remains negative and we recommend holding short positions.
The price of the British pound continued to decline amid expectations of today's publication of statistics on inflation (08:30 GMT). In addition, the elections will be held next month, and at the moment neither Labourists nor the Conservatives have no advantages and there is a chance that the parties will have to spend a long process for the formation of a coalition government. Quotes of the British pound are also under the pressure of strengthening of the US dollar. We maintain our medium-term negative outlook on the British pound and expect the fall in the near future.
The price of the yen began to grow on the back of weak statistics from China, which raised investors' concerns about further economic growth in the region. It is worth noting that the strengthening of the Japanese currency accelerated against the background of statement of economic adviser of Prime Minister Shinzo Abe, who said that the further dollar growth against the yen and 125.00 is unreasonable in his opinion, and that the yen will not drop significantly. Today the dynamics of trading will depend on the data from the US. We maintain our medium-term negative outlook on the yen, but there is a decrease in the potential for decline.
The price of the Australian dollar started to rise after reaching a local minimum, as well as in connection with a positive index of business sentiment in Australia in March to 3, against 0 in February. Tomorrow is expected the increase volatility of in connection with the publication of data on consumer confidence in Australia, the growth of GDP and industrial production in China. The situation in China and iron ore prices are the main factors that influence the dynamics of the Australian dollar. We maintain our medium-term negative outlook and recommend holding short positions.
The New Zealand dollar price corrected upwards after a strong downward movement. Support also was the growth of the Australian currency. Data on the index of business sentiment in New Zealand that in the first quarter fell to 23, which is one worse than the previous value, failed to significantly affect the course of trading. Our forecast for the near future remains negative and we expect strong growth volatility after tomorrow's publication of statistics on GDP and industrial production in China.