24.03.2016 - The dollar continues to strengthen
Currency trading and the euro. The price of euro shows a drop on a background of strengthening of US dollar. The reason for the negative dynamics was the loose monetary policy of the ECB, as well as statements by the Federal Reserve officials, who believe that US interest rates may be increased more than 2 times in this year. It is worth noting the growth of inflation in the United States, against the background of the low comparative base in energy prices will maintain a hawkish mood among the Fed members. Yesterday was also published strong data on new home sales in the US, which rose to 512 million in February, which coincided with forecasts of analysts. Today, in the US was published important news on the volume of orders for durable goods (12:30 GMT). Our medium-term outlook for the euro remains negative.
Currency trading and the British pound. The price of the British pound continues to decline after unreasonably strong growth of previous weeks. The main reason for pessimism are still concerns about the UK’s exit from the EU structure, together with the expected strengthening of the US dollar it may lead to a drop in prices by 10-15% a pound. Today, we should pay attention to the statistics on retail sales in the UK (09:30 GMT). Our medium-term outlook for the British pound remains negative.
Currency trading and the Japanese yen. The price of the Japanese yen continues to gradually decline against the backdrop of weak economic statistics from Japan and increase the probability of the Fed's interest rates hike during the next meeting of the Open Market Committee in the United States. It is worth noting that the growth of the yen at the beginning of the year was caused by increased demand for defensive assets, but at the moment we see a decline in the volatility of the markets and analysts are less pessimistic in their forecasts. In this regard, we expect loss of interest in defensive assets, which, together with the divergence in monetary policy of the Fed and the Bank of Japan will lead to a strong decrease in the yen. Our medium-term outlook remains negative.
Currency trading and the Australian dollar. The price of the Australian dollar shows confident decline due to the strengthening of the US currency, as well as the fall in oil prices, the continuation of which will lead to a further weakening on commodity markets, which traditionally have a strong impact on the dynamics of the Australian dollar. Today in Australia is the day off. Our medium-term outlook remains negative.
Currency trading and the New Zealand dollar. The price of the New Zealand dollar has continued to fall today against the strengthening of the US dollar and the negative dynamics of commodity markets. Positive statistics on the country's trade balance surplus which rose in February to 339 million against the forecast of 75 million, could not lead to a change in the negative trend. Today in New Zealand is a holiday. We expect saving of negative dynamics in the near future and medium term.