27.07.2016 - The yen fell sharply after the recent strengthening
Currency trading and the euro. The price of euro slightly changed and continued to move within the local downtrend before today's publication of the Fed's statement on monetary policy (18:00 GMT). According to our estimates, it will leave interest rates at previous levels, but further dynamics of the euro will depend heavily on the rhetoric of the Fed. In addition, today the dynamics of trading will influence the data on the volume of orders for durable goods in the US (12:30 GMT). Our medium-term outlook for the euro remains negative and we expect a rise in volatility today.
Currency trading and the British pound. The price of the British pound continued to consolidate due to the expectation of important news from the US, but continues to be under the pressure from the negative impact of the results of the referendum during which was supported the idea of country's exit from the European Union. After the consolidation is likely a strong price movement, the trigger for which may be the publication of the preliminary report on GDP growth in the UK in the second quarter (08:30 GMT). In addition, we should pay attention to the data on retail sales in the country. Our medium-term outlook for the British pound remains negative.
Currency trading and the Japanese yen. The price of the Japanese yen today showed a sharp decline after the recent strengthening. Despite the fact that the government's stimulus plan disappointed investors, the yen’s quotations declined amid speculation about the possibility of additional measures from the Bank of Japan. We recall that the central bank's statement will be published on Friday and will lead to a strong price movement. Our medium-term outlook remains negative.
Currency trading and the Australian dollar. The price of the Australian dollar today showed strong growth in volatility after the release of report on consumer price index for the 2nd quarter of this year. Thus, the inflation rate rose by 0.4%, in line with expectations, and for the year this figure totaled 1.0% against the expected 1.1%. Despite the increase in inflation, after declining by 0.2% in Q1, there is a probability of the RBA lowering interest rates, which will be negatively displayed on the price of the Australian currency. Our medium-term outlook remains negative.
Currency trading and the New Zealand dollar. The price of the New Zealand dollar, which traditionally follows the Australian currency showed strong movements and fell after a sharp rise recorded yesterday after the release of data on the trade balance of the country. Today the attention of traders will be focused on the news from the US, where will be published the statement on monetary policy. On Friday, we should pay attention to the business confidence index of the New Zealand. Our medium-term outlook remains negative.