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[LF.Anastasia]

NZD: New Zealand Dollar has not determined movement direction

At the Forex currency market the New Zealand rate traded slightly downward on Tuesday which was obviously caused by the flow of Chinese statistics.

Forex forecast: MACD indicator for the pair NZD/USD is moving along the signal line in the negative area and is not giving a clear signal. Stochastic Oscillator continues to go up moderately in the neutral zone and is giving a buy signal.

Forex recommendations: in case of breakdown at the level of 0.8220 the pair will go to 0.8240 and 0.8250.

Macro-economic background in New Zealand is stable.

The Reserve Bank kept interest rate unchanged at the level of 2.5% in March, as expected. RBNZ noted in the comments that there is no reason to revise interest rate at the moment.

House price index REINZ fell by 1.4% m/m (+25.2% y/y) in January against preliminary expectations of decline of 0.1% m/m. Unemployment rate in the country dropped to 6.3% in Q4 this year against the level of 6.6% a quarter earlier. The data is positive and indicates that employment sector, as one of the main supportive element for the economy, will enable to provide stability even under condition of pessimistic external influence. According to the data released earlier, prices for export in New Zealand increased by 1.7% q/q in Q4 versus the level of -4.0% in Q3. Import prices rose by 3.2% on quarterly basis for the same reporting period against the previous decline of 3.4%. Previous statistics showed that activity in the manufacturing sector of New Zealand rose by 1.3% in Q4 against the fall of 1.4% earlier.

GDP in New Zealand increased by 0.8% q/q (+1.9% y/y) in Q3 against the forecast of +0.6% on quarterly basis. GDP in Q2 rose by 0.1% q/q (+1.5% y/y) versus the level of +0.9% q/q (+1.6% y/y) in Q1. Actually there is stagnation in the economy of New Zealand. GDP almost has stopped its growth however started to revive later. Most likely, the index will be weaker in Q4.

Permits to construct fell by 6.7% m/m in February against revised level of +8.3% m/m in January. Statistics released earlier showed that business confidence rose to 33.8 points in March, as per NBNZ estimates, against the level of 28.0 points in February. The data keeps the NZD from significant sales. The boom in the construction sector of the country remains the main catalyst for the rise in the business confidence.

 

[LF.Anastasia]

EUR/USD: Euro is undetermined today

The pair EUR/USD traded slightly upward at the Forex currency market on Wednesday morning.

By 8.20 Moscow time the Euro is at 1.3089 against yesterday’s closing level of 1.3081.

The major pair is in the medium term oversold channel at the moment and technical signals indicate different trends.

Investors aim to move away from risks and not to make purchases, as problematic countries of Eurozone do not provide steady positive indications about economic stabilization, at least temporary.

Market will continue to follow comments of the members of the U.S. Federal Reserve.

Most likely, the pair EUR/USD will be in the range of 1.3050-1.3150 at the trading session on Wednesday.

 

[LF.Anastasia]

GBP: British Pound tries to regain losses again

At the Forex currency market the British Pound rate traded slightly upward on Wednesday, trying to regain from yesterday’s sales. Market still tends to move away from risks.

Forex forecast: MACD indicator for the pair GBP/USD remains in the positive area; it is going down and is giving a sell signal. Stochastic Oscillator is leaving oversold zone and is giving a buy signal now.

Forex recommendations: off the market.

Feasible event scenario at Forex: in case of breakdown at the level of 1.5880 the pair GBP/USD will go to 1.5590 and 1.5920. If aggressive sellers will be back in the pair the target will be the level of 1.5840.

The data released today showed that level of retail sales in the UK increased due to warm weather and demand for clothing in March. Thus, index in the shops which were open less than one year ago rose by 1.3% y/y in March, while the index in February went down.

It is worth noting that reaction of the Bank of England to this statistics was not very enthusiastic. Increasing unemployment and high oil prices can complicate the rise in demand.

It is interesting that against this background, consumer confidence in the UK GFK/NOP declined to -31 points in March against the level of -29 points. The data indicates strong destabilization in the British economy.

House price index RICS in the UK rose to -10 points in March against the level of -13 points in February. This is the highest level in the index since June 2010.

GDP in the UK fell by 0.3%on quarterly basis (+0.55 Y/Y) in Q4, while economists expected less significant fall of 0.2% q/q. Balance of current account in the UK was at the level of -stg8.451 billion in Q4 against the forecast of –stg8.4 billion. At the same time volume of consumer expenditures at the end of 2011 increased only by 0.4% on quarterly basis (+0.5% q/q on quarterly basis).

Unemployment rate amounted to 5.0% in February; number of unemployed increased by 7.2 thousand. Weakness in the sector prevents economic recovery of the country. PMI Markit/CIPS in the manufacturing sector rose to 52.1 points in March against revised value of 51.5 points. This data gave good support to the currency. The index was at highs since May 2011 and the main driver of growth was the volume of new orders: 52.7 points against the level of 50.5 points earlier. This index is maximal as well-at the peaks since March last year.

 

[LF.Anastasia]

CHF: Swiss Franc maintains positions in the narrow range

At the Forex currency market Swiss Franc rate is still in the range of 0.9145-0.922 in the middle of the week. The upper border of the range is steady while the bottom has shifted.

Forex forecast: MACD indicator for the pair USD/CHF is going up moderately in the negative area and is giving a buy signal. Stochastic Oscillator is coming out of the overbought zone, giving a sell signal.

Forex recommendations: off the market.

Feasible event scenario at Forex: in case of breakdown at the level of 0.9175 the pair USD/CHF will go to 0.9180 and 0.9200. If “bears” turn up in the pair, the target will become the level of 0.9130.

Mr. Jordan from Swiss National Bank said yesterday that Central Bank is ready to make greater efforts to maintain monetary stability after markets’ attacks at 1.20 in the pair EUR/CHF. He also emphasized that opinions about lack of determination in SNB are incorrect. According to him, CB is still prepared to buy currency in unlimited quantities.

Statistics released on Tuesday showed that unemployment rate in Switzerland was at the level of 3.1% in March, as expected.

Currency reserves rose to 237.5 billion in March against previous level of 224.9 billion francs. PMI SVME in Switzerland increased to 51.1 points in March against the forecast of 49.5 points. However other data was weak: retails sales rose only by 0.8% y/y in February against previous value of +4.7% y/y and the forecast of growth of 2.0% y/y.

Manufacturing sector is still weak in Switzerland, however it shows recovering trend. Index of industrial activity SVME rose to 49.0 points in February against the forecast of 48.5 points. Real retail sales increased by 4.4% y/y in January versus growth of 1.7% in December. GDP in the country rose by 0.1% q/q (+1.3% y/y) in Q4 against the forecast of zero change (+1.1% y/y). The data is quite good and indicates that Swiss economy is getting used to expensive Franc. Thus, the regulator expects that inflation will amount from -0.6% to +0.6% in 2012-2014, GDP growth will be at the level of 1.0% this year.

It became known earlier that consumption indicator UBS in Switzerland fell to 0.87 points in February against preliminary level of 0.93 points. CPI rose by 0.6% m/m (-1.0% y/y) in March against the forecast of growth of 0.4% m/m. However, Franc was more focused on the external background and ignored this statistics.

At the last meeting of Swiss National Bank a three-month Libor rate was left unchanged at the level of )%. In general, SNB’s view on monetary policy remains unchanged.

 

[LF.Anastasia]

JPY: Japanese Yen has strengthened again

At the Forex currency market the Japanese Yen rate traded slightly downward in the middle of the week, against yesterday’s rise.

Forex forecast: MACD indicator is for the pair USD/JPY goes down in the positive area, while volumes are low and is giving a sell signal. Stochastic Oscillator goes down in the neutral zone, giving a similar signal.

Forex recommendations: in case of breakdown at the level of 80.70 the pair USD/JPY will go to 80.60 and 80.40. Consolidation near the current levels is possible.

The data released this morning showed that levels of bank lending continue to rise in the country, which is a positive factor. In addition, number of orders for industrial goods went up suddenly in February which is also a favourable signal.

A regular meeting of the Bank of Japan, which finished this week, was rather quiet. Interest rate was left at the level of 0.1% per annum; volumes of assets repurchase program have not been revised either. In the follow-up comments the regulator noted that European negative influence on the economy is still there, although to a lesser extent; however there is still no progress in the economic system. In general, the views of the Bank contradicted the opinion of Japanese government, who would like to see more dynamic stimulation of the economy.

Statistics released earlier showed that current account balance in Japan amounted to Y1.178 billion in February. In addition, index of economic observers rose to 51.8 points in March against the level of 45.9 points in February. The data indicates that positive trend in the Japanese economy is still preserved.

This data is perfectly consistent with the previous indexes: Retail sales increased by 3.5% in February against expectations of growth of 1.3%. Real GDP amounted to -0.2% q/q (-0.7% y/y) in Q4. Current account balance amounted to -Y437.3 billion in Q4 against the forecast of +Y322.3 billion. Personal consumption rose by 0.4% q/q last quarter against the forecast of growth of 0.3% q/q.

Unemployment rate in Japan fell to 4.5% in February against the forecast of 4.6%.

 

[LF.Anastasia]

AUD: Australian Dollar is still very weak

At the Forex currency market the Australian Dollar rate traded upward in the middle of the week; however it still looks weak and liable to sales.

Forex forecast: MACD indicator for the pair AUD/USD goes down in the negative area, maintaining a sell signal, while volumes are high. Stochastic Oscillator went out of the oversold zone and is giving a buy signal at the moment.

Forex recommendations: off the market.

Feasible event scenario at Forex: in case of breakdown at the level of 1.0290 the pair will go back to 1.0300 and 1.0330. If external background deteriorates, the target for sale will be the level of 1.0250.

Statistics released in the middle of the week demonstrated that consumer lending WESTPAC-MI in Australia fell by 1.6% m/m in April to the level of 94.5 points.

At the same time mortgage lending showed decline of 2.5% m/m against expectations of fall of 4.2%.

Statistics released earlier showed that number of jobs in Australia increased by 0.7% q/q in December-February. Previous statistics demonstrated that unemployment rate in the country amounted to 5.2% in January against 5.1% earlier. Number of employed reduced by 15.4 thousand against the forecast of growth of 5 thousand. Inflation in Q4 showed zero growth in the country against the forecast of rise of 0.4% on quarterly basis. Retail sales fell by 0.1% m/m in December versus the forecast of growth of 0.2%. Statistics released earlier showed that unemployment rate amounted to 5.2% in January against 5.1% earlier. Number of employed reduced by 15.4 thousand against the forecast of growth of 5 thousand. Index of leading indicators WESTPAC rose by 0.6% m/m in January against revised growth of 0.7% m/m in December.

Meeting of the Reserve Bank of Australia, which was held earlier, had mixed outcome: interest rate was left at the previous level of 4.25% per annum; however it was the tone of the follow-up comments that made investors feel anxious. Thus, the regulator stressed that the RBA is able to lower the rate if macro-economic data will show slowdown in domestic demand. The RBA also emphasized that European negative impact is very significant.

Activity index AiG in the service sector rose to 47.0 points in March against the fall of 5.3 points in February. Trade balance amounted to -А$0.48 billion in February against the level of +A$1.3 billion in January.

The Reserve Bank of Australia stated earlier that funding problems can be preserved in the country this year, although access to funding has become easier for many banks. The RBA emphasized that uncertainty in Europe and slow down in the global economy can have a significant impact on Australian economic system. This statement was unfavourable for the AUD.

 

[LF.Anastasia]

NZD: Trades are volatile for New Zealand Dollar

At the Forex currency market trades for the New Zealand rate are still volatile. At the Asian session investors bought out part of yesterday’s sales and that was the only positive factor.

Forex forecast: MACD indicator for the pair NZD/USD is moving along the signal line in the negative area and is not giving a clear signal. Stochastic Oscillator is in the neutral zone and is not giving a clear signal.

Forex recommendations: in case of breakdown at the level of 0.8180 the pair will go to 0.8200 and 0.82500. Otherwise the target for sale in the pair will be the level of 0.8150.

It became known today that business sentiment index NZIER in New Zealand was at the level of 13.0 points in Q1 against 0 points in Q4 2011.

The report was quite good; however the pair NZD/USD has ignored it.

House price index REINZ fell by 1.4% m/m (+25.2% y/y) in January against preliminary expectations of decline of 0.1% m/m. Unemployment rate in the country dropped to 6.3% in Q4 this year against the level of 6.6% a quarter earlier. The data is positive and indicates that employment sector, as one of the main supportive element for the economy, will be able to provide stability even under condition of pessimistic external influence. According to the data released earlier, prices for export in New Zealand increased by 1.7% q/q in Q4 versus the level of -4.0% in Q3. Import prices rose by 3.2% on quarterly basis for the same reporting period against the previous decline of 3.4%. Previous statistics showed that activity in the manufacturing sector of New Zealand rose by 1.3% in Q4 against the fall of 1.4% earlier.

GDP in New Zealand increased by 0.8% q/q (+1.9% y/y) in Q3 against the forecast of +0.6% on quarterly basis. GDP in Q2 rose by 0.1% q/q (+1.5% y/y) versus the level of +0.9% q/q (+1.6% y/y) in Q1. Actually there is stagnation in the economy of New Zealand. GDP almost has stopped its growth however started to revive later. Most likely, the index will be weaker in Q4.

Permits to construct fell by 6.7% m/m in February against revised level of +8.3% m/m in January. Statistics released earlier showed that business confidence rose to 33.8 points in March, as per NBNZ estimates, against the level of 28.0 points in February. The data keeps the NZD from significant sales. The boom in the construction sector of the country remains the main catalyst for the rise in the business confidence.

The Reserve Bank kept interest rate unchanged at the level of 2.5% in March, as expected. RBNZ noted in comments that there was no reason to revise interest rate currently.

 

[LF.Anastasia]

EUR/USD: Euro is still being corrected after surge of sales

The pair EUR/USD is growing at the Forex currency market on Thursday morning.

By 8.50 Moscow time the Euro is at 1.3131 against yesterday’s closing level of 1.3108.

Declaration made by Spain that reduction in GDP in the first quarter is not going to be as significant as expected by the market, have eased the nerves of players a little.

In general, there have not been fundamental changes in the external background today and growth in the major pair is largely attributed to corrective bounce.

Tonight, investors will watch over American statistics on employment.

Most likely, the pair EUR/USD will be not go beyond the range of 1.3080-1.3180 at the trading session on Thursday.

 

[LF.Anastasia]

GBP: British Pound continues to grow slowly

At the Forex currency market the British Pound rate continues to grow in moderate pace on Thursday.

Forex forecast: MACD indicator for the pair GBP/USD remains in the positive area; it is going down and is giving a sell signal. Stochastic Oscillator goes up in the neutral zone and is giving a buy signal.

Forex recommendations: in case of breakdown at the level of 1.5940 the pair GBP/USD will go to 1.5950 and 1.5970. Consolidation at the current levels is possible.

House price index RICS in the UK rose to -10 points in March against the level of -13 points in February. This is the highest level of the index since June 2010.

GDP in the UK fell by 0.3%on quarterly basis (+0.55 Y/Y) in Q4, while economists expected less significant fall of 0.2% q/q. Balance of current account in the UK was at the level of -stg8.451 billion in Q4 against the forecast of –stg8.4 billion. At the same time volume of consumer expenditures at the end of 2011 increased only by 0.4% on quarterly basis (+0.5% q/q on quarterly basis).

Unemployment rate amounted to 5.0% in February; number of unemployed increased by 7.2 thousand. Weakness in the sector prevents economic recovery of the country. PMI Markit/CIPS in the manufacturing sector rose to 52.1 points in March against revised value of 51.5 points. This data gave good support to the currency. The index was at highs since May 2011 and the main driver of growth was the volume of new orders: 52.7 points against the level of 50.5 points earlier. This index is maximal as well-at the peaks since March last year.

The data released today showed that level of retail sales in the UK increased due to warm weather and demand for clothing in March. Thus, index in the shops which were open less than one year ago rose by 1.3% y/y in March, while the index in February went down. However, it is worth noting that reaction of the Bank of England to this statistics was not very enthusiastic. Increasing unemployment and high oil prices can complicate the rise in demand.

It is interesting that against this background, consumer confidence in the UK GFK/NOP declined to -31 points in March against the level of -29 points. The data indicates strong destabilization in the British economy.

 

[LF.Anastasia]

CHF: Swiss Franc tends to grow again

At the Forex currency market Swiss Franc rate traded upward on Thursday.

Forex forecast: MACD indicator for the pair USD/CHF is going up moderately in the negative area and is giving a buy signal. Stochastic Oscillator is coming out of the overbought zone, giving a sell signal.

Forex recommendations: in case of breakdown at the level of 0.9140 the pair USD/CHF will go to 0.9130 and 0.9110.

Despite SNB firmness to protect the level of 1.20, talk about a chance of shifting level of pegging Franc to the Euro at 1.25, is intensifying in the market.

Mr. Jordan from Swiss National Bank said this week that Central Bank is ready to make greater efforts to maintain monetary stability after markets’ attacks against the level of 1.20 in the pair EUR/CHF. He also emphasized that opinions about lack of determination in SNB are incorrect. According to him, CB is still prepared to buy currency in unlimited quantities.

Unemployment rate was at the level of 3.1% in March, as expected.

It became known earlier that consumption indicator UBS in Switzerland fell to 0.87 points in February against preliminary level of 0.93 points. CPI rose by 0.6% m/m (-1.0% y/y) in March against the forecast of growth of 0.4% m/m. However, Franc was more focused on the external background and ignored this statistics.

At the last meeting of Swiss National Bank a three-month Libor rate was left unchanged at the level of )%. In general, SNB’s view on monetary policy remains unchanged.

Currency reserves rose to 237.5 billion in March against previous level of 224.9 billion francs. PMI SVME in Switzerland increased to 51.1 points in March against the forecast of 49.5 points. However other data was weak: retails sales rose only by 0.8% y/y in February against previous value of +4.7% y/y and the forecast of growth of 2.0% y/y.

Manufacturing sector is still weak in Switzerland, however it shows recovering trend. Index of industrial activity SVME rose to 49.0 points in February against the forecast of 48.5 points. Real retail sales increased by 4.4% y/y in January versus growth of 1.7% in December. GDP in the country rose by 0.1% q/q (+1.3% y/y) in Q4 against the forecast of zero change (+1.1% y/y). The data is quite good and indicates that Swiss economy is getting used to expensive Franc. Thus, the regulator expects that inflation will amount from -0.6% to +0.6% in 2012-2014, GDP growth will be at the level of 1.0% this year.