19.12.2014 - Today we expect fixation of positions
The price of euro yesterday showed continued falling on the background of the US Federal Reserve statement on monetary policy in the country. So, it was noted that the rates will not be maintained at the current level for a long period of time and will be increased next year. In addition, the rise of the dollar against the euro was supported by the news on the labor market in the country, where the number of initial claims for unemployment benefits fell to 289 thousand, which is 8 thousand better than analysts' expectations. The index of business confidence in Germany rose to 105.5 in December, against 104.7 in November. Today, is probable the fixation of positions. The course of trading will be affected by the data on consumer confidence index in Germany (07:00 GMT) and the euro area balance of payments (09:00 GMT). We maintain our medium-term negative outlook for the euro.
The price of the British pound yesterday corrected upwards and compensated half of the previous fall caused by the Fed's statement. It is worth noting that the bulls were supported by strong growth in retail sales in the country, which unexpectedly rose 1.6% in November, compared with an expected increase of only 0.3%. This figure indicates a strong domestic demand and is improving the prospects for GDP growth. Today, the course of trading will be affected by the data on the net borrowing of the public sector and (09:30 GMT) and the balance of retail sales (11:00 GMT). We expect growth of quotations in the near future, but for opening positions we will need a confirmation signal.
The Japanese yen has stabilized after a decline. Today, it was decided to leave the monetary policy parameters unchanged and the country to maintain the level of asset purchases at 80 trillion yen. It is worth noting a decrease in business activity index in October to 0.1%, against expected growth of 0.2%. At the moment, we see that investors are in no hurry with actions before the Christmas holidays and probably strong movements should be expected after the New Year. Considering the difference in monetary policy of the Fed and the Bank of Japan, we keep the medium-term negative outlook on the yen.
The Australian dollar continues to consolidate in the descending channel after it showed a strong decline after the publication of the protocols of the Fed on monetary policy. Negative trend remains stable due to a number of negative factors including the decline in price of iron ore, which is the main export commodity. In addition, the slowdown in China and the policy of the Reserve Bank of Australia aimed at further decrease the price of the national currency of the country leads to a weakening of the Australian dollar. We maintain our medium-term negative outlook and recommend holding short positions.
The price of the New Zealand dollar continued to strengthen after was published data on GDP growth in Q3. We recall that the New Zealand economy grew by 1.0% against the expected 0.7%. In addition, the index of business confidence in New Zealand in November fell to 30.4, which is 1.1 worse than the previous figure. We expect early completion and the resumption of the upward momentum and lowering prices. Our medium-term outlook remains negative and we recommend holding short positions.