22.10.2014 - ​The housing market in the United States shows strong results

The price of euro fell yesterday in connection with information regarding the possibility of the beginning of the purchase of corporate bonds in the euro area by the European Central Bank. It is worth recalling that earlier decision was made to purchase government and mortgage bonds. In addition, data on existing home sales in the United States has strengthened the dollar. Thus, sales rose to 5.17 million, which is 2.4% more than in the previous month. Today, the focus will be on the data on the consumer price index in the United States in September (12:30 GMT), which is likely to decline due to the fall in oil prices. Reducing inflation is the reason to delay raising interest rates by the Fed. In this regard, we expect growth in the euro today, but keep medium-term negative outlook.

The price of the British pound slightly decreased yesterday on statistics on public sector borrowing. So, in September figure rose by 11.8 billion, which is 1.6 billion more than in the previous month. In addition, the strengthening of the dollar against the background of data on the housing market has led to a decline the British pound. Today will be the voting of the Monetary Policy Committee of the Bank of England (08:30 GMT), and at 19:00 will be the speech of the member of this committee Martin Weale. Given the stable indicators of the UK economy and the likelihood of raising interest rates before the Bank of England than in the United States, we maintain a medium-term negative outlook.

The Japanese yen started to decline on the background of data on the trade balance of the country, deficit of which rose in September to 1.07 trillion, against the forecast of 0.91 trillion. It should be noted that export growth was the highest for the year and amounted 6.9%, against 6.5% expected. Experts point out the positive impact of the devaluation of the yen on the export growth. Tomorrow the dynamics of trading will be affected by the data on the manufacturing PMI. Investors also will be watching inflation data in the United States. We maintain a medium-term negative outlook for the yen, but today we can see its strengthening.

The price of the Australian dollar was unable to continue its growth on the background of positive data on the growth of industry in China, which was published yesterday. Today trader’s mood deteriorated due to the decrease of the index of leading economic indicators up 0.2% in August, against a growth rate of 0.6% in the previous period. At the same time, the consumer price index in Australia remained at 0.5%, compared to a projected decline of 0.4%. Tomorrow volatility may increase due to the speech of the head of the Reserve Bank of Australia. We maintain a medium-term negative outlook for the Australian dollar.

The New Zealand dollar rose slightly yesterday, but could not continue the upward trend due to the strengthening dollar after data on the housing market in the United States. In addition, the decline in business activity in Australia has also become a negative for traders. Tonight we expect increased activity of investors after the publication of the Consumer Price Index. Our medium-term outlook remains negative due to the policy of the Reserve Bank of New Zealand aimed at reducing currency and weak data on the country's trade balance.

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