31.05.2016 - The dollar weakened against most world currencies

Currency trading and the euro. Price of euro slightly corrected upwards after the recent sharp fall. This fact was caused by fixing positions on the US dollar, after strong growth boosted by the probability of the Fed raising interest rates, as well as a strong data on US GDP growth in Q1. Today trading session will be full of important data. So, we should pay attention to the statistics on retail sales in Germany (06:00 GMT), the index of consumer prices and unemployment in the euro area (09:00 GMT), as well as personal income and consumer spending in the US (12:30 GMT ). Our medium-term outlook for the euro remains negative and we are waiting for a further decline in the near future.

Currency trading and the British pound. The price of the British pound showed a sharp increase, but could not continue it. The dynamics of trading on the British currency in the coming weeks will be volatile due to the expectation of a referendum on the country's membership in the EU, which will take place on 23 June. This week the dynamics of trading will depend on external factors and publications of surveys about voters’ choice on the referendum at the end of next month, after which we expect to see growth of quotations.

Currency trading and the Japanese yen. The price of the yen stabilized after the recent decline, caused by the rise of the US dollar. Today, volatility slightly increased in relation to the publication of important statistics in the country, but could not significantly affect the mood of investors. Thus, household spending fell in April by 0.4%, vs. expected 1.3%, the unemployment rate was 3.2%, and industrial production rose unexpectedly by 0.3%, against an expected decline of 1.4%. We expect a further price decline of the yen against the US dollar amid divergence of interest rates of the Bank of Japan and the Federal Reserve.

Currency trading and the Australian dollar. The price of the Australian dollar showed growth today on the weakening of the US dollar, as well as in connection with the publication of data on the increase in the number of permits issued for construction of new homes by 3.0% in April, compared with an expected drop by 3.1%. At the same time, the current account deficit in Q1 has made 20.8 billion, compared with a forecast of 19.3 billion. Investors are waiting for the publication of data on GDP growth in Australia and the manufacturing PMI in China and Australia, which will be published tomorrow. Our medium-term outlook for the Australian dollar remains negative, but the current correction may continue.

Currency trading and the New Zealand dollar. The price of the New Zealand dollar has adjusted upwards within the local downtrend. The reason for this movement was the data on the index of business confidence in the country, which rose in March to 11.3, compared with 6.2 in February. Support was the increase of the Australian currency. Tomorrow, the mood of investors will depend on the data from China and Australia. Our medium-term outlook remains negative.

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