22.05.2014 - ​In the minutes of the Fed was noted the weakness of the housing market

The price of euro yesterday continued to decline due to weak balance of payments data in the Eurozone. Thus, the Figure in March fell to 18.8 billion against the forecast of 24.2 billion. The main reason for the deterioration of the indicator was the decline in the trade surplus. The consumer confidence index rose to -7 against the forecast of -8. Publication of protocols of the Fed allowed to offset some losses. Many members of the Fed mentioned the weakness of the housing market, and we have not seen anything new in the minutes of the previous meeting. Today the course of trading will be affected by data on the services and manufacturing PMI (08:00 GMT), the U.S. labor market (12:30 GMT) and the index of leading economic indicators of the U.S. (14:00 GMT). We m

The British pound continued to rise amid positive retail sales data which showed the maximum increase since May 2004. The index rose by 6.9% per year versus economists' forecast of 5.3%. In addition, the Bank of England voted to keep interest rates at 0.50%, but the question of tightening monetary policy was discussed. Today we should pay attention to the data on the growth of the British GDP (8:30 GMT) and the data on production orders (10:00 GMT). We expect the price growth in the medium and long term.

After a sharp decline, the price of USD/JPY resumed the growth. The reason for the growth was the increase in U.S. bond yields, indicating a decline in demand for defensive assets. In addition, investors decided to fix position after the publication of minutes of meetings of the U.S. Federal Reserve. The head of the Bank of Japan Haruhiro Kuroda noted that there is no reason for the growth of the yen and the Bank will continue its policy of quantitative easing. We maintain long-term and medium-term positive outlook for the pair.

The price of the Australian dollar has started to correct upwards after a strong decline in the previous trading sessions. The reason for the growth was the need for a technical correction, the end of the fall in iron ore prices and the positive statistics on the industry in China, where manufacturing PMI increased to 49.7 against the forecast of 48.1. We expect continued growth, but keep medium-term negative outlook for the Australian dollar.

The price of the New Zealand dollar has stopped falling against the strengthening of the Australian currency and improvement of the indicators of industry in China, which is the main trade partner of New Zealand. Despite this, the quotations are under the pressure of low prices for export commodities and risks of the construction industry in China. We maintain a medium-term negative outlook and expect the resumption of the downward movement.

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