Major U.S. stock indexes finished the last trading session of the week lower on weak reports of Visa and Amazon.com. In addition, the services PMI in the U.S. fell to 54.2, with an expected growth to 56.2. At the same time, the index of consumer confidence rose in April to 84.1, that is 0.9 better than the forecast. Negative factor for the market also became the rising tensions in Ukraine, where is growing the risk of a direct military conflict. At a meeting of G-7 was approved another package of sanctions against Russia, and it can be applied today. We expect continuation of decrease on the U.S. markets and maintain a long-term negative outlook.
The gradual growth of
quotations of euro on Friday was caused by raising the credit rating of Spain
by Fitch Ratings to BBB+ against the previous level BBB. Despite this the growth
has stopped due to strong data on U.S. consumer confidence. At the moment,
investors do not hurry to accumulate positions because of upcoming U.S. Fed
statement on monetary policy, which will be held on Wednesday and uncertainty
regarding further development of the situation in Ukraine. Today is not
expected the release of important macro in Europe and the USA. We maintain a
The quotes of the British pound declined slightly during the last trading session of the week in connection with the closing of positions before the weekend, as well as against the strengthening of the U.S. dollar. Statistics published on Friday, turned out to be controversial. On the one hand retail sales rose by 0.1%, versus the expected decline by 0,4%, on the other the number of mortgage approvals has fallen to 54.2 in April, which is 2,0 worse than the forecast. Increase in volatility is expected tomorrow, after the release of data on the growth of the UK GDP in Q1. We expect continued growth and maintain medium and long term positive outlook.
The price of USD/JPY dropped to a strong level of 102.00. The reason for the strengthening of the yen was the data on inflation. Thus, the consumer price index in March remained at 1.3% per annum, despite the growth forecast up to 1.4%. In addition, today was released the statistics on retail sales in March that rose to 11.0% compared to the same period of the last year. Analysts had expected growth to 10.9%. Increased demand for the yen as a defensive asset is due to the growth of tension around Ukraine. We expect the resumption of growth of the pair and maintain medium and long term positive outlook.
The price of the Australian dollar corrected upwards due to the long decline in the previous days and the necessity of correction. Low inflation may lead to weakening of monetary policy of the Reserve Bank of Australia and a further decline of the national currency. The growth of volatility is expected this week on Wednesday night when will be published the data on manufacturing PMI of Australia and China. We maintain a medium-term negative outlook for the Australian dollar, although the growth within the correction may continue in the near future.
The price of the New Zealand dollar remained almost unchanged throughout the trading session. Today at 22:45 GMT, will be published the data on the trade balance of New Zealand, which will lead to an increase in volatility and will help to determine the direction of prices in the medium term. We expect price growth in the medium term.
The price of American benchmark Light sweet crude oil continues to fall on a background of record volumes of oil inventories and production in the United States. Support for oil prices is provided by news from Libya, where 2 ports were blocked, and the situation in Ukraine, which can lead to disruptions of oil supplies from Russia. From a fundamental point of view, we maintain a long-term negative outlook, but political risks may lead to an increase in oil prices.
The price of gold continued to rise amid falling U.S. stock indexes and the unstable situation in Ukraine. Despite this, the long-term demand from investment funds remains low. Interest to the metal on Asian markets also is not growing. In case of further decline on the stock markets and rising tensions in Ukraine, we expect the growth of gold prices in the medium and long term.