15.07.2016 - Data from China cheered investors

Currency trading and the euro. The price of euro rose yesterday against the background of positive dynamics of the British pound. Investors were in no hurry to build up positions ahead of today's publication of important statistics on retail sales and consumer price index in the US (12:30 GMT). In addition, we should pay attention to the statistics on index of consumer confidence from the University of Michigan (14:00 GMT). Data on inflation can greatly affect investors' expectations regarding the timing of the Fed raising interest rates this year, but the probability of such a move is still low. Our medium-term outlook for the euro is negative.

Currency trading and the British pound. The price of the British pound continued to rise after the Bank of England yesterday took an unexpected decision to leave the interest rate at the historically low level of 0.50% and not to use additional funds for the purchase of bonds. It is worth noting that the easing of monetary policy may occur in August, but we expect more important statistics at the Bank of England. Today, little impact on the course of trading may provide data on the index of leading economic indicators in the United Kingdom (13:30 GMT). Our medium-term outlook remains negative.

Currency trading and the Japanese yen. The price of the Japanese Yen continued its decline against the US dollar amid the publication of more encouraging statistics on the state of the Chinese economy, which, together with a reduction of concerns about the situation in the UK has led to a reduction in demand for protective assets. In addition, investors will continue to fix positions after prolonged strengthening of the Japanese currency since the beginning of this year. On Monday, in Japan is a day off. Today, volatility will likely be increased on the background of strong US dollar movements after the publication of important data on inflation. Our medium-term outlook remains negative for the yen.

Currency trading and the Australian dollar. The price of the Australian dollar rose slightly against the publication of data from China, which was better than analysts' expectations. Thus, GDP growth in the second quarter was 6.7%, which is 0.1% more than the forecast, the volume of industrial production in June increased by 6.2% compared to the same period last year, against the expected 5.9% and the retail sales for the same period increased by 10.6%, against the forecast of 9.9%. Our medium-term outlook remains negative, despite the possible continuation of growth in the next few days.

Currency trading and the New Zealand dollar. The price of the New Zealand dollar has continued to fall despite the publication of much more optimistic statistics from China that is a key trading partner for the country. The dynamics of the New Zealand currency is adversely affected by the strengthening of the US dollar and lower commodity prices. On Monday will be published statistics on the consumer price index in New Zealand for the second quarter, and in case of low inflation, the likelihood of the Reserve Bank of New Zealand lowering interest rates will significantly increase. Our medium-term outlook remains negative.

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