26.03.2014 - Consumer confidence in the U.S. is growing

Major U.S. indexes ended the trading session with a slight increase. The data on new home sales, which fell by 3.3% to 440 million in February and reached its lowest level since last September has influenced the course of trading. At the same time, the consumer confidence index grew in March to 82.3 against the forecast 78.7. Today the course of trading will be affected by the data on the orders durable (12:30 GMT) and the index of business activity in the U.S. service sector (13:45 GMT).

On this background the price of euro reached 1.3750, but was unable to fix below it and continues its consolidation around the mark 1.3810. Volatility of EUR/USD rose on statements by the head of the ECB Mario Draghi in which he noted a willingness to use the tools necessary to maintain price stability. According to Draghi, the strengthening of euro is explained by external factors, including loose monetary policy in Japan and the growth of investor’s confidence in the Eurozone. We maintain a long-term negative outlook for the euro, but do not exclude the possibility of price growth in the medium term.

The British pound strengthened against decrease in inflation to four-year low due to lower transport prices. Thus, the index of consumer prices rose by 1.7% over the year as expected, and the production inflation fell to 0.4% vs. forecasted increase by 0.4%. Weak data on the U.S. housing market contributed to the growth of the pound. Today won’t be released any important macro in the UK and the course of trading will depend on data from the U.S. We maintain a long-term positive outlook for the pound.

Volatility of the yen is still at a low level and the price of USD/JPY continues its consolidation in the corridor 102,15-102,50. Investors expect the new signals, which can become a big block of statistics that will be released on Friday. In addition, the course of trading will be affected by data from the U.S. In general, growth of a pair is restrained by geopolitical tensions and the return profits to Japan from overseas offices of Japanese corporations. We maintain a long-term positive outlook for the pair.

The price of the Australian dollar has strengthened on the background of the report of the Reserve Bank of Australia on financial stability, in which the head of the Bank Glenn Stevens noted the stability of the inflation rate, the revision of investments and credits in favor of the mining industry and the fact that the decline of the Australian dollar contributes to balanced growth in the economy. At the moment, there is a high probability of price correction of the Australian currency. Despite the recent growth, we maintain a long-term negative outlook for the Australian dollar.

The New Zealand dollar continued its growth after a long consolidation. The reason for optimism has become speculations on possible new measures to stimulate the economy in China, as well as strengthening of the Australian dollar. We expect the growth of prices of the New Zealand dollar in the medium term.

The price of Light Sweet crude oil is supported by news about reducing supplies from Libya and hopes for new stimulating measures in China. Oil production in Libya has decreased by 80 thousand barrels per day to 150 thousand. In addition, market fears the escalation of conflict between the West and Russia. Central news of the week will be the release of data on oil and petroleum products' inventories in the U.S. (14:30 GMT). We expect the growth of volatility and keep a long-term negative outlook for oil. We recommend opening short positions after the price fixing below $ 99 per barrel.

Drop in gold has stopped above the level of 1310 dollars per troy ounce. Reserves of the world's largest gold secured exchange-traded fund SPDR Gold Trust increased to 821.47 tons, and in ounces the reserves reached a maximum level since December. To determine the future direction of the price, traders need new signals. At the same time, we maintain a long-term positive outlook for gold prices which are supported by uncertainty about future growth on the stock markets.

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