30.06.2014 - The markets are waiting data on inflation in the Eurozone
of euro rose in the last trading session of the week, despite the increase in
the index of consumer confidence in the U.S. to 82.5 against the forecast of
growth to 82.2. At the same time, currency quotes were supported by growth in
consumer spending in France in May by 1.0% against the expected 0.3%. Investors
have also positively assessed signing the agreements on association with
Georgia, Moldova and Ukraine. We expect that the price decline of euro will
The growth of the British pound stopped on Friday after the release of data on reduction of the UK balance of payments deficit in Q1 to 18.5 billion that is 1.4 billion worse than the forecast of analysts. It also became known that in the Q1 the GDP grew by 0.8%, which coincided with the forecast, and the volume of business investments increased by 5.0%. Today, the trade dynamics will depend on the credit market in the country (8:30 GMT). We expect the price growth of the pound in the medium term.
The price of the Japanese yen continued to strengthen after the release of data on industrial production, which rose in May by 0.5%, against a decline of 2.8% in April and the forecast of growth by 0.9%. Tomorrow we expect the increased volatility due to release of data on the manufacturing and non-manufacturing PMI in the second quarter. Falling of the USD/JPY in the near future may continue, but we expect a reversal of the downward trend in the medium term due to loose monetary policy in Japan and its tightening in the United States.
The price of the Australian dollar has not changed much, despite the decline in new home sales in Australia in May by 4.3% against growth of 2.9% in April. The price of the Australian dollar is supported at a high level due to the rising price of iron ore, which, despite the recent increase, remains at relatively low levels. Tomorrow the course of trading will be influenced by the decision of the Reserve Bank of Australia on monetary policy. Considering decline in investments in the mining sector and the deterioration in the housing market, we expect a decrease in price of the Australian dollar in the medium term.
The New Zealand dollar fell today due to the sharp decline in the index of business confidence in New Zealand to 42.8 in May against 53.5 in April. Further price direction will depend on the growth of Chinese industry, the data on which will be published tomorrow. Considering strong growth in the previous days and the willingness of the Reserve Bank of New Zealand to fight against the high cost of the national currency, which threatens the further economic growth, we expect a drop in prices of the New Zealand dollar in the medium term.