22.01.2016 - Mario Draghi hinted at further monetary easing

Currency trading and the euro. The price of euro showed a strong level of volatility yesterday after ECB President Mario Draghi has hinted at a possible easing of monetary policy to fight the deflationary risks that are caused by low oil prices and fears associated with the development of China's economy. It should be noted that the statistics on the number of initial unemployment claims in the US disappointed investors. Thus, the figure increased by 10 thousand to 293 thousand. Today, the dynamics of trading will affect the speculations regarding a possible increase in the program of quantitative easing in the euro area, the statistics on manufacturing and service PMI of the Eurozone (09:00 GMT) and sales in the secondary market in the US (15:00 GMT). Our medium-term outlook for the euro remains negative and we expect falling prices in the near future.

Currency trading and the British pound. The price of the British pound showed a sharp increase within the correction and the weakening US dollar. It is worth noting that in recent weeks the British currency continues to steadily decline amid speculation about a referendum on the UK’s exit from the European Union. This factor will put pressure on quotations for a long time. Today, it is worth paying attention to statistics on retail sales and UK public sector net borrowing (09:30 GMT). We maintain a medium-term negative outlook, but in the near future, we expect to see a significant correction.

Currency trading and the Japanese yen. The price of the Japanese yen showed a decline against the US dollar on the background of the comments of Assistant of Prime Minister of Japan Shinzo Abe on the need to soften the monetary policy of the Bank of Japan to support the economy amid volatility on global financial markets. Today was published preliminary statistics on the manufacturing PMI, which in January was 52.4, which is worse than the forecast of 0.4 and 0.2 less than the previous figure. According to our forecasts, the situation in the financial markets will stabilize in the near future, which will lead to a decrease in demand for defensive assets and lead to a reduction of the yen against the US dollar. Our medium-term outlook remains negative.

Currency trading and the Australian dollar. The price of the Australian dollar today shows an increase against the background of a strong correction in commodity markets, which traditionally have a strong influence on the dynamics of the Australian currency. In addition, strong growth in Asian markets, which are the main consumers of Australian products, supports the optimism of investors. On Monday in Australia is a day off. According to our forecasts, the current upward correction may continue in the near future, but the medium-term outlook remains negative.

Currency trading and the New Zealand dollar. The price of the New Zealand dollar showed strong growth within the correction after the improvement in commodity markets and the growth of the Australian currency, has led to an improvement in investor sentiment. The acceleration of growth is also explained by fixing the position after a significant decrease in the previous weeks. The next week will decide on interest rates, but the regulator is likely to wait for the new actions to stabilize the situation on the market. Our medium-term outlook remains negative despite the possible increase in the near future.

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