26.08.2014 - The trade balance of the New Zealand disappointed investors

The price of euro remained virtually unchanged yesterday and continues to consolidate near the level of 1.3200. Drop in the business confidence index in Germany for 1.7 in August to 106.3 was offset by weak data on new home sales in the United States, which fell to 412 thousand, compared with an expected 426 thousand. Dynamics of euro will depend on the statistics from the United States. We should pay attention to durable goods orders (12:30 GMT), the index of house prices (13:00 GMT) and the index of consumer confidence in the United States (14:00 GMT). We maintain a medium-term negative outlook and expect continued consolidation of euro in the near future.

The price of the British pound yesterday corrected upwards, despite the holiday. Trading volumes were more than 3 times less than the average. This week is not expected the release of a large number of important macroeconomic data from the United Kingdom. Today, the course of trading may be affected by the data on the number of permits for mortgage lending in the country (08:30 GMT). We expect low trading volumes and a further price consolidation. Our medium-term outlook remains positive.

The price of the Japanese yen strengthened today against correction of the dollar and expectations of the meeting of the Presidents of Russia and Ukraine in Minsk. Investors are hoping that a personal meeting will help to end the conflict in eastern Ukraine. In addition, the Islamists captured the airport in Libya, which also increased the demand for defensive assets. The price index for corporate services remained unchanged at 3.7%. We maintain a medium-term negative outlook for the Japanese yen and expect the continuation of further decline in the coming days.

The price of the Australian dollar continues to decline gradually due to weak macroeconomic indicators. The index of leading economic indicators in China grew by 1.3% in July, repeating the result of the previous month. Tomorrow will be published statistics on new home sales in Australia. Due to the decline in investment in the mining sector, the construction sector is one of the growth drivers of the economy. We maintain a medium-term negative outlook for the Australian dollar and recommend holding short positions.

The price of the New Zealand dollar continued to fall after the release of negative trade balance data of the country. Thus, the trade deficit of New Zealand in July totaled 692 million with an expected 475 million. It is worth mentioning that in the previous months, the trade surplus was one of the main drivers of growth price of currency. Currently there are no preconditions for changing the negative trend. We expect further price reduction in the near future.

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