28.05.2015 - Statistics on GDP growth in the UK will be in the focus of investors
Currency trading and the euro. The price of euro offset the losses of previously acquired positions on news of the technical negotiations with creditors. Thus, the VAT in Greece will be reformed, but the pension system will remain unchanged. Statistics on the growth of the index of consumer confidence from GfK in Germany to 10.2 in June from 10.1 in May, could not significantly influence the course of trading. Today, the course of trading will be affected by the news of the number of initial unemployment claims in the US (12:30 GMT). Investors will not hurry with actions before tomorrow's publication of the report on GDP growth in the United States. We expect a drop in prices of the euro in the medium term and a strong volatility tomorrow.
Currency trading and the British pound. The price of the British pound continues to gradually decline on the background of improved sentiment towards the US dollar due to the increasing probability of the Fed raising interest rates at the next Fed meeting. At the same time, investors are in no hurry to accumulate positions ahead of the publication of the second preliminary report on the GDP growth in the UK in the first quarter (8:30 GMT), which is likely to support quotes a British currency and lead to its correction. Our medium-term outlook for the British currency remains negative, but we assume the possibility of upside movement today.
Currency trading and the Japanese yen. The price of the Japanese yen continues to decline and now is on the lowest level since 2007. The reasons for the fall are the strengthening of the US dollar and the loose monetary policy of the Bank of Japan. Today was published statistics on retail sales, which showed growth of 5.0% in April compared with the same period of the last year. Tomorrow is forecasted the increase of volatility in connection with the release of a large block of statistics on inflation, unemployment and industrial production in Japan. Our medium-term outlook for the yen remains negative.
Currency trading and the Australian dollar. The price of the Australian dollar continues to decline within a sustainable downtrend. The fall accelerated after the publication of statistics on capital investments in the country, which fell in the first quarter by 4.4%, which is 2.0% worse than analysts' expectations. It is worth noting that the low prices of iron ore and other raw materials, as well as the growth of the US dollar are the main reasons for the fall of the Australian dollar. Soft RBAâs monetary policy also promotes the downward price movement. We maintain a medium-term negative outlook and recommend holding short positions.
Currency trading and the New Zealand dollar. The price of the New Zealand dollar continues to decline following the Australian currency. Low prices for dairy products, which are caused by an excess of supply on the market are the main internal factors that negatively affects the dynamics of prices. At the same time, investors predict a possible lowering of interest rates by the Reserve Bank of New Zealand to stimulate economic growth. We expect a further fall in prices in the near future and medium term.