20.05.2016 - Volatility declined after the recent strengthening of the dollar

Currency trading and the euro. The price of euro continued to consolidate near the level of 1.1200 due to the expectation of the new signals. Earlier, quotations have decreased due to the increase in the probability of the Fed raising interest rates after the publication of the previous Fed meeting minutes. Yesterday, the support for the euro became weak data on manufacturing PMI of Philadelphia, which totaled -1.8 in May against the forecast of 3.2. Today, the dynamics of trading will affect the balance of payments data for the euro area (08:00 GMT) and sales in the secondary real estate market in the US (14:00 GMT). Before the weekend we should not expect strong price movements. Our medium-term outlook remains negative, despite the possibility of price correction in the near future.

Currency trading and the British pound. The price of the British pound is consolidating after recent gains caused by increasing optimism about the results of the referendum on the country's membership in the EU. Today, little effect on the course of trading will have data on the balance of production orders in the UK (10:00 GMT). In the near future we do not exclude the strong movements of the British currency rates, but the optimism associated with the preservation of the country within the EU, will support the British currency.

Currency trading and the Japanese yen. The price of the Japanese yen continues to consolidate after has fallen against the background of the increased probability of the Fed raising interest rates in June. Investors are watching the G-7 Summit that takes place in Japan. On Monday, the dynamics of trading will affect the data on the trade balance and the index of business activity in Japan. Our medium-term outlook remains negative due to a possible weakening monetary policy settings in Japan and its tightening in the United States.

Currency trading and the Australian dollar. The price of the Australian dollar corrected upwards after the recent decline, which is caused by a rising correction on the commodities market. The main factors that continue to influence the dynamics of the Australian dollar remains the situation in China, the dynamics of prices for commodities, the recent reduction in interest rates of the RBA to 1.75% and the expectation of tightening in US monetary policy. Our medium-term outlook remains negative.

Currency trading and the New Zealand dollar. The price of the New Zealand dollar showed an upward correction after failed to overcome the local minimum. Next week, it is worth paying attention to the data on trade balance and presentation of the draft of the New Zealand’s state budget. Today, negative for the New Zealand dollar was the statistics on the growth of the number of tourists in the country at 7.9%, against 18.0% in the previous period. Our medium-term outlook for the New Zealand dollar remains negative.

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