18.02.2016 - Investors are waiting for tomorrow's report on inflation in the US
Currency trading and the euro. The price of euro is lowering against the US dollar, on the background of optimism about the market growth, which is caused by the expectation of a later increase of the Fed's interest rate and oil price recovery. It is worth noting that yesterday has been published weak data on the US housing market, where the number of housing starts totaled only 1.10 million vs. expected 1.16 million, which was due to bad weather conditions. This fact can lead to greater growth in spring. The minutes of the last Fed meeting noted uncertainty about the pace of growth of the economy and inflation. Today, it is worth paying attention to the balance of payments of the Eurozone (09:00 GMT), minutes of the previous meeting of the European Central Bank (12:30 GMT) and the weekly report on the number of initial unemployment claims in the US (13:30 GMT). We maintain our medium-term negative outlook for the euro.
Currency trading and the British pound. The price of the British pound showed increased volatility yesterday after the publication of statistics on the labor market in the country, where unemployment has remained at around 5.1%, while the number of unemployed decreased by 14.8 thousand, which is better than the forecasted reduction by 2.9 thousand. Tomorrow will be published statistics on retail sales and the balance of production orders in the UK. We maintain our medium-term negative outlook, and expect further reduction of quotations in the near future.
Currency trading and the Japanese yen. The price of the Japanese yen strengthened today against the backdrop of statistics on the trade balance, the surplus of which rose to 0.12 trillion yen, which is two times better than the forecast of analysts. It should be noted that exports to Japan fell by 12.9%, after a reduction of 8.0% in the previous month. Reduced exports to China for the month was 17.5%, which was the sixth in a row. Tomorrow a strong influence on the course of trading will have inflation data in the US, which will strongly affect investors' expectations regarding the timing of the Fed raising interest rates. Our medium-term outlook remains negative and we look forward to the resumption of the negative dynamics of the yen in the near future.
Currency trading and the Australian dollar. The price of the Australian dollar shows a correctional movement after yesterday rose strongly against the background of rising oil prices. The reason for today's decline was the data on the labor market of the country where the unemployment rate rose to 0.2% in January, to 6.0%. At the same time, the number of people employed in the country decreased by 7.9 thousand against the forecast of growth by 12.9 thousand. Given the expected decline in oil prices and the possibility of further easing of monetary policy of the RBA in connection with low inflation, we expect a continuation of the negative dynamics of the price of the Australian dollar in the medium term.
Currency trading and the New Zealand dollar. The price of the New Zealand dollar after the recent growth has resumed falling against the background of the negative dynamics of the Australian dollar. The producer price index in the country at the output fell by 0.8% in the 4th quarter, vs. predicted 1.3% in the previous period. This fact will encourage the RBNZ to lower interest rates. We forecast a drop in the New Zealand national currency prices in the medium term due to weak data on trade and the expected easing of monetary policy.