26.01.2016 - The yen and the euro rose against the background of deteriorating market sentiment

Currency trading and the euro. The price of euro resumed growth amid falling stock markets and falling oil prices, after a strong upward correction recorded at the end of last week. Investors did not rush to accumulate positions before the Fed decision on interest rates, which, according to our forecast will remain unchanged and more important event of the week will be the publication of the preliminary report on the growth of US GDP in the 4th quarter, which will be held on Friday. Today, the course of trading will affect the news on the index of business activity in the US service sector (14:45 GMT) and the index of US consumer confidence from the Conference Board (15:00 GMT). Our medium-term outlook for the euro remains negative, but the deterioration in sentiment on the commodity and stock markets will support demand for the European currency.

Currency trading and the British pound. The price of the British pound continued to fall against the US dollar on a background of complete correction of prices and weak statistics on the balance of production orders, which worsened to -15 in January, against -7 in December. Investors are waiting for today's speech by the Bank of England Governor Mark Carney (10:45 GMT), which can show the dovish attitude of the regulator about the possibility of rising interest rates. The strong influence on this week will also have news on the UK GDP growth in the 4th quarter, which may lead to an increase in the recent decline. Our medium-term outlook remains negative.

Currency trading and the Japanese yen. The price renewed strengthening of the Japanese yen against the background of falling oil prices, which resulted in a decrease in the stock indices. Despite this, investors are waiting for the meeting of the Bank of Japan, which will end on 29 January and in which the parameters of monetary policy in the country will be changed in order to stimulate the growth of inflation in the country. This decision will reduce the yen, but the demand for protective assets will continue to have a strong influence on the market. Our medium-term outlook for the yen remains negative.

Currency trading and the Australian dollar. The price of the Australian dollar after a slight correction, resumed decline amid renewed negative trends on the stock markets of China and the decline in commodity prices. Increased tension in the market associated with a slowdown of growth in China and a fall in oil prices had a negative impact on investor sentiment with respect to the commodity currencies. Tomorrow we should pay attention to the data on the consumer price index and the consumer confidence index in Australia. Our medium-term outlook remains negative and we expect a continuation of the negative dynamics of prices in the near future.

Currency trading and the New Zealand dollar. The price of the New Zealand dollar shows a steady decline after was not able to continue the upward movement within the correction. Tomorrow evening will be published statement of the RBNZ on monetary policy, which will lead to an increase in volatility. We do not expect any easing of monetary policy at this time, but probably will hear hints about lower interest rates in the near future. Our medium-term outlook for the New Zealand dollar remains negative.

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