30.03.2016 - Statement of Yellen has led to a weakening of the dollar

Currency trading and the euro. Price of euro rose after Fed chairwoman rhetoric was dovish in comparison with other members of the American regulator. In a statement, Mrs. Yellen noted a gradual increase in interest rates that will depend on economic indicators. As a result of the weakening of the US dollar, the euro may continue the growth today, but its potential remains limited. Investors are waiting for the publication of an important labor market report in the US that will be released on Friday. According to our estimates, inflation in the US will continue to rise against the background of a lower base of comparison that will force the Fed to tighten monetary policy this year. Our medium-term outlook for the euro remains negative.

Currency trading and the British pound. The price of the British pound showed an increase amid the weakening of the US dollar after a speech by Janet Yellen that has led to a decrease in the probability of the Fed raising interest rates in the next few months. Today will not be published important statistics in the UK, but tomorrow we should pay attention to statistics on business investment, balance of payments and GDP growth in the 4th quarter. The current growth of the British currency is to be used for the accumulation of short positions in anticipation of falling prices amid fears the country of the European Union after the referendum on 23 June. Our forecast for the coming months remains negative.

Currency trading and the Japanese yen. The price of the Japanese yen showed a sharp strengthening of the weakening of the US dollar, as well as in connection with the fixation of position after a strong decline in the previous trading session. The publication of weak data on industrial production in the country was unable to change the mood of investors. Thus, the volume of industrial production in the country fell in February by 6.2%, which is 0.4% worse than forecast and growth of 3.7% in January. According to our forecast, the yen will resume the fall on improved investor sentiment regarding the global economic outlook compared with the predictions of the beginning of the year, which has led to increased interest in defensive assets. Our medium-term outlook remains negative for the yen.

Currency trading and the Australian dollar. The price of the Australian dollar showed strong growth against the background of the weakening US dollar and rising price of gold, which is an important export commodity for the country. Despite the strong upward momentum, the potential for further increase is limited. Tomorrow will be published statistics on new home sales in Australia that can support the local currency. Our medium-term outlook remains negative, despite the current price growth.

Currency trading and the New Zealand dollar. The price of the New Zealand dollar showed a strong growth and reached the highest level since the beginning of the year. The reason for the rapid growth was short covering and the weakening of the US dollar. It is worth noting that tomorrow will be published statistics on the index of confidence in the business community of New Zealand, which may lead to further growth of the New Zealand dollar. Our medium-term outlook remains negative due to the expectation of monetary easing in the country against the background of low inflation.

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