27.11.2015 - Volatility on the markets has fallen sharply
Currency trading and the euro. The price of euro continues to gradually decline against the background of the expected approval of additional measures to support the growth of inflation in the euro area by the ECB, at a meeting on December 3rd. At the same time, investors' activity is minimal in connection with the celebration of Thanksgiving in the US yesterday. Today, investors will not rush to accumulate positions and the dynamics of trading may slightly affect the statistics on consumer confidence in Germany (12:00 GMT). We maintain a medium-term negative outlook for the euro with the objectives of 1.05, 1.02 and 1.00 due to the expected easing of monetary policy of the ECB and its tightening by the Fed.
Currency trading and the British pound. The price of the British pound after the decline shows price consolidation. Activity on the market is reduced due to the holiday in the US. In addition, investors are waiting for the publication of the preliminary report on the GDP growth in the UK (09:30 GMT) in the third quarter, an improvement of which will lead to the growth of the pound. A slight effect on the course of trading will have news on the index of house prices in the UK (07:00 GMT). For the continuation of the negative dynamics is needed a significant stimulus. We expect a further decline in prices of the pound in the medium term.
Currency trading and the Japanese yen. The price of the Japanese yen continued to consolidate after the contradictory statistics in the country. Thus, the unemployment rate in Japan fell to its lowest level since 1995 of 3.1%. On the other hand, household spending declined by 2.4% in October, but analysts expected the index to remain at the same level. It should be noted that core inflation fell by 0.1%, in line with market expectations, and the main pressure on the indicator continues to have a decrease in energy prices. Expected Fed raising interest rates according to our forecasts will lead to further reduction of the yen in the medium term.
Currency trading and the Australian dollar. The price of the Australian dollar has stabilized after the recent correction and investors expect new drivers for the movement of prices. Strong influence on the course of trading continues to have the dynamics of prices for raw materials, accounting for most of the country's exports. On Monday will be published news on new home sales in Australia, the growth of which will support the Australian currency quotes. We expect falling prices in the medium term, despite possible short-term growth in the near future.
Currency trading and the New Zealand dollar. The price of the New Zealand dollar was not able to continue to grow and now is consolidated within a narrow range. Volatility has declined substantially due to the holiday in the US. On Monday, the report will be published on an index of business confidence in New Zealand, which can increase the activity on the market. The main factors that will affect the mood of investors in the coming months are expectations of lowering interest rates by the RBNZ and their increase in the United States. Our medium-term outlook remains negative and we recommend holding short positions.