15.09.2015 - The inflation data in the UK can support the growth of the pound

Currency trading and the euro. The price of euro yesterday fell slightly against the backdrop of technical correction. It is worth noting that the main theme of the market is the future Fed's decision on interest rates. In the case of raising interest rates of the US regulator, we will see a strong drop in price of euro. Statistics on industrial production in the Eurozone yesterday was not able to change the mood of investors. Thus, the index rose by 0.6% in July against the forecast of 0.3%. Today, volatility will increase in connection with the publication of a large number of important statistics, the index of business sentiment in Germany and the Eurozone’s trade balance and employment in the euro area (09:00 GMT). In addition in the United States, will be released the data on retail sales (12:30 GMT), the volume of industrial production (13:15 GMT) and business inventories in the US (14:00 GMT). Our medium-term outlook remains negative.

Currency trading and the British pound. The price of the British pound yesterday showed a decline, but returned to previous levels and are now consolidated in anticipation of the publication of important statistics on inflation (08:30 GMT), the growth of which will increase the likelihood of earlier raising of interest rates of the Bank of England and support the British pound. In addition, important data will be released tomorrow on the labor market in the UK. We expect increased volatility in prices this week and despite the potential upside in the near future, maintain a medium-term negative outlook for the pound.

Currency trading and the Japanese yen. The price of the Japanese yen rose slightly after the statement of the Bank of Japan on monetary policy. Thus, the parameters of monetary policy remained unchanged, in case of new signs of weakness of economic growth in October, the regulator may decide to increase the volume of purchases of assets from the current 80 trillion yen per year. At the same time, the bank noted that the slowdown in growth in emerging markets adversely affected the export of Japanese goods. We maintain a medium-term negative outlook on the yen and increased volatility during this week.

Currency trading and the Australian dollar. The price of the Australian dollar lowered after the publication of minutes of the Reserve Bank of Australia where was noted that a further decline of the Australian dollar appears positive for the export of services and support of the economy in general, current interest rates remain appropriate. In addition, in Sydney house prices continue to rise. Tomorrow will be released a quarterly newsletter published by the Reserve Bank of Australia. We maintain a negative medium-term outlook for the Australian dollar, but admit the possibility of an upward price movement in the near future within the correction.

Currency trading and the New Zealand dollar. The price of the New Zealand dollar continues to consolidate in anticipation of important statistics on the balance of payments for the second quarter (22:45 GMT). In addition, tomorrow will be published data on GDP growth in New Zealand for the second quarter. The data is likely to disappoint investors and falling prices will continue. We maintain a medium-term negative outlook and recommend holding short positions on the New Zealand currency.

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