22.07.2015 - The RBNZ is likely to lower interest rates
Currency trading and the euro. The price of euro rose yesterday on the background of fixing positions in the US dollar against other major currencies, after strong growth in the previous week. Support for the euro was the news from Greece, where the government has submitted to parliament a series of laws necessary for getting a third bailout package. The focus of investors is on the monetary policy of the Federal Reserve System. Thus in the case of the Fed raising interest rates in September, the US dollar will continue to rise against the euro. Today, the negative for the euro may be a strong statistics on the index of house prices (13:00 GMT) and sales on the secondary market in the US (14:00 GMT). Our medium-term outlook remains negative with the objectives of 1.07 and 1.05.
Currency trading and the British pound. The price of the British pound continues to consolidate despite the weakening of the US dollar. Investors are waiting for the publication of the results of voting of the Committee on monetary policy on interest rates (8:30 GMT). Earlier the head of the Bank of England hinted at the approach of the moment of monetary tightening in the country, which will support the quotations of the British currency, but we do not expect such a move this year. Tomorrow is forecasted the increase in volatility following the publication of a report on retail sales in the country. Our medium-term outlook remains negative.
Currency trading and the Japanese yen. The price of the Japanese yen rose against the US dollar on profit taking after the strong growth of the US currency in the previous week. Today has been published statistics on the index of business activity in Japan. Thus, the index in May fell by 0.5%, in line with analysts' forecasts. A strong influence on the course of tomorrow's auction will have the data on the trade balance of the country. Our medium-term outlook remains negative and we expect the resumption of the downward movement of prices in the near future.
Currency trading and the Australian dollar. The price of the Australian dollar showed a strong increase in volatility today in connection with the speech of the head of the Reserve Bank of Australia, in which he noted the preservation of the possibility of lowering interest rates. At the same time, he noted that the decline in interest rates can cause risks. At the same time, Glenn Stevens noted the improvement at the labor market. We expect the price decline of the Australian dollar in the medium term to 0.70.
Currency trading and the New Zealand dollar. The price of the New Zealand dollar began to rise against the background of fixing position after strong fall in prices in the previous trading session. Investors are waiting for the decision of the Reserve Bank of New Zealand (21:00 GMT), which with a high probability will reduce interest rates. Lowering may be by 0.50% or 0.25%. We expect a continuation of the downward movement of prices in the medium term and in the near future.