30.10.2014 - Fed statement has led to the growth of the US dollar
The price of euro fell sharply after the Fed statement regarding US monetary policy, which has led to the strengthening of the dollar. Thus, the statement indicated the completion of the quantitative easing program which started in September 2012, also interest rates will remain at a level below 0.25% for a considerable period. Despite this, the likelihood of higher interest rates in 2015 increased, despite the fact that now, analysts predict their rise in September and not in August like before. US inflation remains under the level of 2.0%, and does not grow due to the fall in oil prices. Today, the price of the euro will also depend on data from the US. Thus, the statistics will be published on the US GDP and the labor market in the country (12:30 GMT). Trading dynamics will also depend on statistics on GDP of Spain (08:00 GMT), as well as changes in the number of unemployed in Germany (8:55 GMT). We maintain a medium-term negative outlook for the euro and recommend holding short positions.
The British pound fell due to the strengthening of the dollar after the Fed statement, as well as in connection with the lending in the country. Thus, the number of mortgage loans in September fell to 61 thousand, which is 2 thousand worse than the forecast. Earlier, the Bank of England said about the risks of growth in house prices and has tightened rules for mortgage loans. At the same time, it is worth noting a decline in retail lending, which dropped to 2.7 billion in September, that is 0.5 billion less than in the previous month. Today we should pay attention to the house price index in the UK (07:00 GMT) and data from the US. In the near future the pound will continue to fall, but we keep the medium-term positive outlook.
The Japanese yen fell against the US dollar after the statement of the US Federal Reserve, which has led to the expectation of the Fed raising rates in September. Thus, the Fed said that the current pressure of falling oil prices on inflation is not a long-term issue and will be compensated after some time. At the same time, investors are in no hurry to build up positions before the publication of data on US GDP (12:30 GMT) and the release of a large block of statistics on unemployment, household spending, CPI and housing market in Japan. In addition, will be published the statement of the Bank of Japan. We expect that price volatility will remain high until the end of the week and keep the negative medium-term outlook for the yen.
The price of the Australian dollar fell against the US dollar after rising confidence of investors about the Fed raising interest rates in September 2015. It is worth noting that the level of new home sales in Australia in September, has not changed, despite the growth rate by 3.3% in August of this year. The growth of the Australian currency is limited by the strengthening of the US dollar, concerns about the growth of China's economy and low prices for export commodities like iron ore. Tomorrow the course of trading will be affected by the data on producer price index, and today a high level of volatility is due to the publication of statistics from the US. We maintain a medium-term negative outlook for the Australian dollar.
The price of the New Zealand dollar fell on the background of the US dollar, as well as in connection with the statement of the Reserve Bank of New Zealand, which left interest rates on hold at 3.50%, in line with expectations and said that he would not raise them because of the low level of inflation . It is worth noting that in the conditions of low prices of export goods and trade deficit, RBNZ intervened earlier to reduce the prices of the New Zealand dollar, and in this regard, its growth is limited. We maintain a medium-term negative outlook on the New Zealand dollar.