17.04.2015 - Statistics on the US labor market has worsened
The price of euro showed growth despite continued fears of investors about the situation with the Greek debt crisis, which could lead to a default of the country. A weaker dollar caused an increase in the European currency. The reason for this was the weak data on the labor market, where the number of initial unemployment claims rose by 12 thousand, to 294 thousand, while the number of housing starts totaled only 0.93 million, against the expected 1.05 million. Today the dynamics of trading will depend on the data on the consumer price index in the euro area (09:00 GMT) and the US (12:30 GMT), as well as statistics on consumer confidence in the US (14:00 GMT). Our medium-term outlook for the euro remains negative and its growth in the near future is possible only within the correction.
The price of the British pound continued to rise on the weakening of the US currency after the publication of weak statistics on the labor and housing market in the United States. Investors continue to assess the likelihood of the Fed raising interest rates in June. Today we expect a strong increase in volatility after the release of important statistics on the labor market in the UK (08:30 GMT) from which depend the timing of interest rate hikes by the Bank of England. It is worth noting that the increase in prices is limited by a strong resistance level at 1.5000, for overcoming of which will be needed a strong impetus. Our medium-term view of the British pound remains negative.
The price of the Japanese yen has stabilized despite the weakening of the US dollar against other major currencies. Consumer confidence in Japan in March rose to 41.7, which is 1.0 better than analysts' expectations and 0.3 better than the forecast. Increased volatility in prices is forecasted after the data on inflation and consumer confidence in the United States. Loose monetary policy of the Bank of Japan continues to put pressure on the quotes of the national currency of the country amid the expectation of monetary tightening in the United States. We maintain our medium-term negative outlook on the yen and its potential for growth in the near future is minimal.
The price of the Australian dollar has stabilized after strong growth caused by the improving situation on the labor market of the country where the unemployment rate fell to 6.1%, which is 0.2% better than the forecast of analysts. The weakening of the US dollar also contributed to the increase in prices. In the near future, rising dynamics will be limited, and we may see a change in trend. Next week the course of trading will be affected by the statement of the Reserve Bank of Australia and the publication of the minutes of the previous meeting of the regulator. We maintain our medium-term negative outlook for the Australian dollar due to the low prices for exports and weakening growth in China.
The price of the New Zealand Dollar continued increasing and reached the important resistance level of 0.77. The weakening of the US dollar has been one of the main reasons for the rise in share price, but investors also note the positive labor market situation in the country and the improvement in the trade balance. According to our estimates the price will continue to consolidate around 0,74-0,77 levels in the near future and we may soon see a downward correction.