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AUD: Australian Dollar tends to grow

The Australian Dollar rate is growing slowly at the Forex currency market on Monday, with the opening level which was lower than the level of Friday.

Forex forecast: MACD indicator is in the positive area for the pair AUD/USD it has broken through the signal line from bottom to the top and is rising, giving a buy signal. Stochastic Oscillator is going up slowly in the neutral zone, giving a buy signal.

Forex recommendations: in case of breakdown at the level of 1.0730, the pair will go to 1.0750 and 1.0790.

At became known on Monday that volume of mortgage lending rose by 4.4% m/m in May against the forecast of consolidation by 4.5% m/m.At the meeting of the Reserve Bank of Australia yesterday the decision was made to leave interest rate at previous level of 4.75% per annum and according to the comments of the regulator, moderately restrictive monetary policy is consistent with the actual situation.

According to the RBA, the base rate will rise very gradually and economic growth in 2011 will be slower than expected. Stevens, the head of the RBA has said in the accompanying statement that Australian economy is gradually recovering after natural disasters, while European debt problems interfere with the process.

Market expected that Stevens would drop a hint at the time when the rate would be raised, however it did not happen. As per the RBA estimates, employment sector of Australia is in the stable state, unemployment rate is described as moderate lately, although it has not affected unemployment rate, which remains at the level of 5%. Earlier, the AUD had found catalyst with the help of statistics: employment rate in the country is recovering faster in June than predicted: (+15 thousand); mainly due to a record number of jobs (the highest level over three years.

This statistics partly relieves concerns about potential slowdown of the economic growth in Australia.Vice president of the Reserve Bank of Australia Mr. Low, stressed earlier that special efforts are required to maintain low and stable level of inflation. According to him previous growth of CPI was attributed mostly to the external factors and influence of the currencies’ exchange rates was insignificant.He also noted that very little unused spare capacity is left in the economy, and the upward pressure on inflation was caused by such facts as labour costs and growing prices for utilities.

 

[LF.Anastasia]

NZD: New Zealand Dollar still strives to soar up

At the Forex currency market, the New Zealand Dollar rate continues to stay near the new local highs of 0.8385, achieved on Friday.

Forex forecast: MACD indicator is in the positive area for the pair NZD/USD, and is going up, giving a buy signal. Stochastic Oscillator is going up in the overbought zone, giving a similar signal.

Forex recommendations: in case of breakdown at the level of 0.8350, the pair will rise to 0.8360 and 0.8380.

Economic situation in New Zealand has not changed significantly this morning.The data on the country’s GDP will become known on 14 July.The data released earlier showed that net level of budget deficit in New Zealand rose to -NZD$40 billion (20.4% billion of the country’s GDP) in May, which was below economists’ forecast.

According to the estimates of the Finance Minister Mr. English, budget deficit is still too large and active measures are required to reduce it.Trade balance in New Zealand was at the level of NZD$605 billion in May against the forecast of NZD$1000 billion.

This is a negative data, because decline in the trade balance will indicate decline in the level of exports later, which will be the impact of cooling in Chinese economy.Earlier, the Reserve Bank of New Zealand decided to keep interest rate unchanged at the minimum of 2.50% per annum, since it is going to continue its work on improvement in economic system.

According to the head of the RBNZ, NZD has been overvalued because of high export prices for raw materials, therefore, national currency rate, which has increased over the last two months, has adverse impact on the rebalancing of the economy in New Zealand.

Bollard expressed confidence that decline of the NZD will be gradual because currency intervention will not be able to change the trend. Negative factor for the New Zealand Dollar was created by Nature last week: earthquake of magnitude 7.9 points have been recorded in the north-east of New Zealand this morning.

The epicenter was located near the Islands of Kermadek and Tonga, at the depth of 48 km. However, market has recovered from the news quickly and reverted to the purchase of the NZD.It became known earlier that business sentiment NZIER in New Zealand rose to 27 points in Q2 against -27 points earlier. In general, it is a positive factor.

 

[LF.Anastasia]

EUR/USD: EURO descends lower and lower

The pair EUR/USD continued its descend on Tuesday morning declining below 1.40, amid external negative factor.By 9.15 Moscow time the Euro is at 1.3958 against yesterday’s closing level of 1.4028.

Sales were caused by the fact that debt crisis begun to spread over the Eurozone countries: yesterday investors paid attention to Italy where government debt has already exceeded 120% of GDP.

According to economists, Italy can be the next country which Eurozone will have to save.Statistics which can significantly change balance of forces in the pair EUR/USD is not going to be released today, however if the data on the U.S. trade balance deficit, which will be known tonight, will be above the forecast, the growth of the Dollar will decrease.

Most likely the pair EUR/USD will not go beyond the range of 1.3900-1.4050 at the trading session on Tuesday.

 

[LF.Anastasia]

GBP: British Pound has not groped for the bottom yet

At the Forex currency market the British Pound Sterling rate continues to decline on Tuesday due to intensification of the external negative factor.

Forex forecast: MACD indicator is in the negative area for the pair GBP/USD, and is moving along the signal line, not giving any signal. Stochastic Oscillator is going down in the neutral zone, it has reached oversold zone, giving a sell signal.

Forex recommendations: n case of breakdown at the level of 1.5840 the pair will go to 1.5820 and 1.5790.

There are no reasons for buying Pound despite its fairly attractive levels: external background remains negative for opening long positions and the pair GBP/USD does not have its own growth catalyst.The head of the Bank of England Mr. Mervyn King noted yesterday that in the next couple of years inflation in the country shall revert to the level of 2.0%.

According to him, current monetary policy is quite logical and its aggressive tightening in the past and this year had been an unwise step.The meeting of the Bank of England was held last week: interest rate was kept unchanged at the level of 0.50% per annum. Statements on the monetary policy have not been made. It is likely that the rate will remain at the current level until Q1 2012.

The minutes of the meeting will be made public on 20 July.It became known today that comparable sales index BRC in Great Britain reduced by 0.6% in June against the slump by 0.2% y/y in May.Economists of JP Morgan reported last Friday that they have revised the UK GDP downward: most likely economy of the country will be either flat in Q2, or will demonstrate slight rise by the end of Q2.

By the way, as predicted by OECD, British economy will rise by 0.1% in Q2. According to the forecast made by NIESR, GDP in Great Britain will rise by 0.1% in June against the revised level of 0.5% in May. It is logical, because economic situation in the UK remains tense.

According to Barclays estimates, British Pound is going to be pessimistic in pairing with the USD, which will be caused by low demand in the country and probability of a new stage of decline in confidence. Position of the bank of England does not facilitate strengthening of the GBP either. Most likely loss of confidence in the finance and monetary policy of Great Britain will be continued - and it is a negative factor for the GDP. Although exchange rate remains low, eliminating sharp collapse of the Pound.

 

[LF.Anastasia]

CHF: Swiss Franc is being corrected after two days of growth

At the Forex currency market Swiss Franc rate goes down on Tuesday after steady growth for two last sessions as a protective currency.

Forex forecast: MACD indicator is in the negative area for the pair USD/CHF, and is going up, giving a buy signal; volumes are below average. Stochastic Oscillator is going down in the neutral zone, has touched oversold zone and is giving a sell signal.

Forex recommendations: off the market.Feasible event scenario at Forex: in case of breakdown at the level of 0.8400, the pair USD/CHF will go to 0.8420 and 0.8450.

If upward breakdown does not take place, the pair will aim at the level of 0.8350.Economic situation in Switzerland has not changed this morning.At the meeting of Swiss National Bank earlier, it was decided to leave three- month Libor rate in the previous range of 0-0,75% with a tendency to 0.25%.

At the same time, the SNB said that GDP growth would amount to 2% this year. Inflation in 2011 is predicted at around +0.9% (previously +0.8%), in 2012: +1.0% (previously 1.15), in 1013: +1.7% (previously +2.0%).Statistics released earlier showed that producer prices and prices for imports decreased by 0.2% (-0.4% y/y) in May against the forecast of growth by 0.1% m/m.

The data released earlier showed that consumption indicator UBS in Switzerland rose by 1.91 points in May against the growth of 1.57 points in April.Representative of Swiss government noted the day before yesterday that national economy is still in good shape despite strengthening of the national currency. As the same time, first signs of cooling in the export sector could be seen and if these symptoms will continue to develop, it will have a negative impact on the economy as a whole.

According to authorities, Swiss National Bank is solely responsible for the course of monetary policy and will likely to adopt new effective measures to achieve price stability soon.

 

[LF.Anastasia]

JPY: Japanese Yen is growing steadily

The Japanese Yen rate continues to rise at the Forex currency market on Tuesday; it is the third day today when the JPY is steady growing.

Forex forecast: MACD indicator is in the negative area for the pair USD/CHF, however it started to move along the signal line and is not giving a clear signal. Stochastic Oscillator is going down in the neutral zone and is giving a sell signal.

Forex recommendations: in case of breakdown at the level of 80.00, the pair will go to 79.75.At the meeting of the Bank of Japan, which was held today it was decided to leave interest rate unchanged in the target range of 0-0.1% per annum as expected.Lending program was also left unchanged in the volume of 30 trillion yen.

According to the Bank estimates, real level of GDP will rise by 0.4% in the fiscal year of 2011 (forecast of April had been more optimistic: +0.6%). In the fiscal year of 2012, GDP growth is expected in the volume of 2.9% which would agree with the April forecast.

Next year CPI is predicted to be at the level of +0.7%.In addition, starting from this June, the Bank of Japan is going to raise its estimate for economic growth in the country, as the growth in the production volumes has triggered revival of exports, and, at the same time, private demand is also growing. It became known today that consumer confidence index in Japan rose to 35.3 points in June against the level of 34.2 points in May.

It is a good sign, showing that economy in the Country of the Rising Sun continues its slow but sure recovery. Statistics released earlier showed that bank lending in Japan decreased by 0.6% y/y in June against the forecast of -0.5% y/y.In addition, orders in the machine-building industry of Japan rose by 3.0% m/m in May against the fall of 3.3% in April.

According to the Cabinet “orders are recovering, however some sectors are lagging behind”. The indicator is usually considered as a leading index of corporate capital expenditures.According to the data released earlier trade balance deficit in May (first 20 days) rose to Y1.053 trillion against the level of Y465 billion in April. It also became known that exports volume for the first 20 days in May totaled - 9.3% y/y versus the fall of -12.4% in April.

The head of the Bank of Japan Mr. Shirakawa said at the beginning of the week that economic growth of the Country of the Rising Sun has faced powerful downward pressure. Nevertheless 7 out of 9 regions of the country have revised their economic forecast upward.

 

[LF.Anastasia]

AUD: Sales of Australian Dollar are going on

At the Forex currency market the Australian Dollar rate continues to be in the focus of sellers’ attention on Tuesday, as external background is not favourable for the purchases of the high risky currencies.

Forex forecast: MACD indicator is in the positive area for the pair AUD/USD; it has broken through the signal line from bottom to the top earlier and is rising, giving a buy signal. Stochastic Oscillator is going up slowly in the neutral zone, giving a buy signal.

Forex recommendations: in case of breakdown at the level of 1.0580, the pair will go to 1.0550 and 1.0530.

As the data released today showed, business conditions index in Australia increased by 2 points in Jule, as per NAB estimates against zero value in May. At the same time, business confidence index NAB amounted to 0 points against the level of +6 points in May, and GDP forecast for the fiscal year of 2011-2012 had been reduced to 1.7%.

Vice president of the Reserve Bank of Australia Mr. Low, stressed earlier that special efforts are required to maintain low and stable level of inflation. According to him previous growth of CPI was attributed mostly to the external factors and influence of the currencies’ exchange rates was insignificant.He also noted that very little unused spare capacity is left in the economy, and the upward pressure on inflation was caused by such facts as labour costs and growing prices for utilities.

At the meeting of the Reserve Bank of Australia yesterday the decision was made to leave interest rate at previous level of 4.75% per annum and according to the comments of the regulator, moderately restrictive monetary policy is consistent with the actual situation.

According to the RBA, the base rate will rise very gradually and economic growth in 2011 will be slower than expected. Stevens, the head of the RBA has said in the accompanying statement that Australian economy is gradually recovering after natural disasters, while European debt problems interfere with the process. Market expected that Stevens would drop a hint at the time when the rate would be raised, however it did not happen. As per the RBA estimates, employment sector of Australia is in the stable state, unemployment rate is described as moderate lately, although it has not affected unemployment rate, which remains at the level of 5%.

Earlier, the AUD had found catalyst with the help of statistics: employment rate in the country is recovering faster in June than predicted: (+15 thousand); mainly due to a record number of jobs (the highest level over three years. This statistics partly relieves concerns about potential slowdown of the economic growth in Australia.However, according to the latest statistics and investors’ sentiment, there is no cause for buying AUD as yet.

 

[LF.Anastasia]

NZD: New Zealand Dollar failed to avoid massive sales

At the Forex currency market, the New Zealand Dollar rate continues to decline on Tuesday morning, keeping on yesterday’s trend in respond to the active sales at the global capital markets.

Forex forecast: MACD indicator is in the positive area for the pair NZD/USD, and is going up slightly, giving a buy signal. Stochastic Oscillator is going down in the overbought zone, giving a sell signal.

Forex recommendations: in case of breakdown at the level of 0.8150, the pair will decline to 0.8130 and 0.8110.

Obviously, external negativism has reached “bullish” positions in the NZD/USD too, forcing to close long positions.The economic situation remains almost unchanged in New Zealand this morning.The data released earlier showed that net level of budget deficit in New Zealand rose to -NZD$40 billion (20.4% billion of the country’s GDP) in May, which was below economists’ forecast.

According to the estimates of the Finance Minister Mr. English, budget deficit is still too large and active measures are required to reduce it.Trade balance in New Zealand was at the level of NZD$605 billion in May against the forecast of NZD$1000 billion. This is a negative data, because decline in the trade balance will indicate decline in the level of exports later, which will be the impact of cooling in Chinese economy.Earlier, the Reserve Bank of New Zealand decided to keep interest rate unchanged at the minimum of 2.50% per annum, since it is going to continue its work on improvement in economic system.

According to the head of the RBNZ, NZD has been overvalued because of high export prices for raw materials, therefore, national currency rate, which has increased over the last two months, has adverse impact on the rebalancing of the economy in New Zealand. Bollard expressed confidence that decline of the NZD will be gradual because currency intervention will not be able to change the trend. Negative factor for the New Zealand Dollar was created by Nature last week: earthquake of magnitude 7.9 points have been recorded in the north-east of New Zealand this morning.

The epicenter was located near the Islands of Kermadek and Tonga, at the depth of 48 km.However, market has recovered from the news quickly and reverted to the purchase of the NZD.It became known earlier that business sentiment NZIER in New Zealand rose to 27 points in Q2 against -27 points earlier. In general, it is a positive factor.On Thursday, 14 July market will expect the release of GDP in New Zealand, which has been postponed earlier.

 

[LF.Anastasia]

EUR/USD: EURO is moderately regaining from lows of January

The pair EUR/USD is growing at the Forex currency market on Wednesday morning with the help of support from the data which shows reduction of inflation in China.

By 9.25 Moscow time the Euro is at 1.3991 against yesterday’s closing level of 1.3975.

The Euro reached lows of January yesterday, amid intensification of the negative external factor, however in the afternoon part of sales has been bought out. China has made investors happy this morning: GDP has slowed down in Q2, which indicates efficiency of the anti-inflationary measures, taken by the local authorities.

Interest in the USD started to wane after the release of the minutes of meeting of the U.S. Federal Reserve of 21/22 June- the document showed lack of unity among members of the Monetary Committee on the issue of the further priming of economy.

The day is going to be eventful in terms of statistics; however it will be of secondary importance, therefore will not significantly affect trading process.

Most likely the pair EUR/USD will not go beyond the range of 1.3970-1.4050 at the trading session on Wednesday.

 

[LF.Anastasia]

GBP: British Pound begun to regain from sales

At the Forex currency market the British Pound Sterling rate tends to grow on Wednesday morning after reaching yesterday’s lows of this year. The Pound does not have momentum for strengthening as yet, nevertheless relative stability of the external background will make it possible to regain partly from yesterday’s sales.

Forex forecast: MACD indicator is in the negative area for the pair GBP/USD, and is moving along the signal line, not giving any signal. Stochastic Oscillator is moving in the same way in the neutral zone.

Forex recommendations: off the market.

Feasible event scenario at Forex: in case of breakdown at the level of 1.5950 the pair will go to 1.5960 and 1.5990. If correction will exhaust, target for decline will become the level of 1.5770.

As it became known yesterday, CPI in Great Britain fell by 0.1% m/m (4.2% y/y) in June versus the forecast of growth by 0.2% m/m. In addition, overall trade balance in the UK amounted to -stg4.06 billion in May against the forecast of stg2.700 billion. It seems that the rise of imports in may triggered the growth of deficit in trade balance of the country.

It became known yesterday that comparable sales index BRC in Great Britain reduced by 0.6% in June against the slump by 2.1% y/y in May.

The head of the Bank of England Mr. Mervyn King noted yesterday that in the next couple of years inflation in the country shall revert to the level of 2.0%. According to him, current monetary policy is quite logical and its aggressive tightening in the past and this year had been an unwise step. The meeting of the Bank of England was held last week: interest rate was kept unchanged at the level of 0.50% per annum. Statements on the monetary policy have not been made. It is likely that the rate will remain at the current level until Q1 2012. The minutes of the meeting will be made public on 20 July.

According to Barclays estimates, British Pound is going to be pessimistic in pairing with the USD, which will be caused by low demand in the country and probability of a new stage of decline in confidence. Position of the bank of England does not facilitate strengthening of the GBP either. Most likely loss of confidence in the finance and monetary policy of Great Britain will be continued - and it is a negative factor for the GDP. Although exchange rate remains low, eliminating sharp collapse of the Pound.

Economists of JP Morgan reported last Friday that they have revised the UK GDP downward: most likely economy of the country will be either flat in Q2, or will demonstrate slight rise by the end of Q2. By the way, as predicted by OECD, British economy will rise by 0.1% in Q2.

According to the forecast made by NIESR, GDP in Great Britain will rise by 0.1% in June against the revised level of 0.5% in May. It is logical, because economic situation in the UK remains tense.