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[LF.Anastasia]

CHF: Swiss Franc is still under pressure

At the Forex currency market Swiss Franc rate remains under pressure from sellers on Thursday, although it started to show signs of recovery.

Forex forecast: MACD indicator for the pair USD/CHF is in the negative area; it has stopped decline and is moving along the signal line, not giving a clear signal. Stochastic Oscillator remains in the overbought zone, giving a buy signal.

Forex recommendations: in case of breakdown at 0.9150 the pair USD/CHF will go to 0.9160 and 0.9180. Consolidation close to the current levels is possible.

Situation in the economy of Switzerland has not changed dramatically for today's trading session.

Statistics released this week showed that 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.

It became known earlier that consumption indicator UBS in Switzerland decreased to 0.87 points in February against preliminary level of 0.93 points.

Production in the manufacturing sector of Switzerland has declined again: volume of industrial output for the reporting period amounted to -1.4% y/y against the level of -1.9% in Q3. It became known earlier that imports rose by 0.7% y/y in February, to the level of 14.04 billion francs, while imports rose only by 1.2% y/y last month 916.72 billion francs) Trade balance amounted to 2.68 billion francs in February rising against the previous level of 1.5 billion francs. According to the data released earlier, unemployment rate in Switzerland amounted to 3.4% in February- no changes.

Manufacturing sector is still weak in Switzerland, however it shows recovering trend. Index of induastial 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 expencive 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.

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 is rising in price amid increasing interest to “safe” currencies

The Japanese Yen continues to gain strength at the Forex currency market today, amid increasing interest to "safe habour" currencies caused by negative external background.

Forex FORECAST: MACD indicator for the pair USD/JPY goes down in the positive area, while volumes are average and is giving a sell signal. Stochastic Oscillator is moving unsteadily in the neutral zone, not giving a clear signal.

Forex recommendations: in case of breakdown at the level of 82.15 the pair USD/JPY will go to 82.10 and 82.00. Consolidation at the current levels is possible.

Marco-economic situation in Japan is stable this morning.

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. Unemployment rate in Japan fell to 4.5% in February against the forecast of 4.6%. In addition, household spending rose by 2.3% y/y in February against expectations of decline of 0.4% y/y. Net CPI rose by 0.1% y/y in February versus expectations of decline of 0.1% y/y. The data is very positive indeed.

JPY was supported by the fact that it was the end of fiscal year, which finished in 31 March. All last week exporters have been brining revenues to the country, now this supportive factor is fading away.

Finance Minister of Japan Mr. Azumi said that the country continues to watch over the negotiations in Europe on establishing so-called protective barrier, the comment was given in response to expectations whether Japan would participate in the fight against European debt crisis through the investment to IMF.

Consumer sentiment index in Japan increased by 1.9 points in March, to the level of 55.6 points, against the level of -57.5 points in December. The data released on Tuesday showed that monetary base in Japan fell to -0.2% y/y in March versus the growth of 11.3% earlier. The Yen did not react to statistics, as investors were focused on external background, which was in general favourable for today's trades.

The head of the Bank of Japan Mr. Shirakawa stressed again that winning the fight against inflation in extremely important for the country. The country of the Rising Sun needs measures to stimulate growth rate; however, these measures and infusions of the Central Bank will not improve the situation.

Retail sales grew by 3.5% y/y in February against expectations of growth of 3.3%. it is a favourable indication, although it shall be supported by further data.

 

[LF.Anastasia]

GBP: British Pound if looking for support to start growth

At the Forex currency market the British Pound rate make attempts to regain on Thursday after mass sales in the last two days.

Forex forecast: MACD indicator for the pair GBP/USD remains in the positive area and is going up, giving a buy signal while volumes are increasing. Stochastic Oscillator has reversed in the neutral zone and is going down, giving a sell signal.

Forex recommendations: in case of breakdown at the level of 1.5890 the pair GBP/USD will go to 1.5880 and 1.5850. Consolidation near the current levels is possible.

A regular meeting of the Bank of England will be held today: investors will be interested in the follow-up comments on economic outlook. This week will be a short one as British markets will be closed on Friday due to Easter celebrations.

Investors’ withdrawal from major currencies intensified because of the pressure of pessimistic comments of the head of the European Central Bank Mr. Draghi.

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.

According to the data released earlier, retail sales fell by 0.8% m/m (+1.0% y/y).
According to the data released earlier, sales excluding fuel fell by the same value and index for January was revised upward up to +0.3% m/m. It seems that weak labour sector and high levels of inflation put pressure on the retail sales index. 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.

Previous statistics demonstrated that 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. GDP in the UK fell by 0.3%on quarterly basis in Q4 (+0.55 Y/Y) while economists expected less significant fall of 0.2% q/q. Balance of current accounts 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).

 

[LF.Anastasia]

EUR/USD: Euro remains under pressure

The pair EUR/USD traded sluggishly at the Forex currency market on Friday morning due to the absence of the most European investors.

By 8.45 Moscow time the Euro isat 1.3067 against yesterday's closing level of 1.3065.

Intensified volatility, which was triggered by a new surge of fears about financial stability in Eurozone, became the cause for mass sales in the pair yesterday.

It is Good Friday in the U.S. and Europe today, trading floors will be also closed on Monday.

It is likely that the pair EUR/USD will be in the range 1.3020-1.3120 on Friday.

 

[LF.Anastasia]

GBP: British Pound was deprived of support

At the Forex currency market the British Pound rate makes at tempts to regain on Friday morning after yesterday's sales. Market is not busy today and trades are not expected to be too active.

Forex forecast: MACD indicator for the pair GBP/USD remains in the positive area and has shifted to the sideways movement and is not giving a clear signal. Stochastic Oscillator has gone into the oversold zone and maintains a sell signal

Forex recommendations: in case of breakdown at the level of 1.5650 the pair GBP/USD will go to 1.5640 and 1.5620. Consolidation near the current levels is possible.

At yesterdays regular meeting the Bank of England decided to leave interest rate unchanged at the level of 0.5% perannum, as expected.

The regulator did not make any other changes, leaving everything as it was. He noted that he would continue toreview the size of the QE program, which will expire in a month time. In this view a meeting of the Bank of England in May is going to be very interesting.

In the afternoon sales in the Pound intensified due to investors' aversion of European risks.

It became known this week that 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.

Previous statistics demonstrated that 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. GDP in the UK fell by 0.3% on quarterly basis in Q4 (+0.55 Y/Y)while economists expected less significant fall of 0.2% q/q. Balance of current accounts in the UK was at the level of -stg8.451 billion in Q4 against theforecast 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).

According to the data released earlier, retail sales fell by 0.8% m/m (+1.0% y/y). According to the data released earlier, sales excluding fuel fell by the same value and index for January was revised upward up to +0.3% m/m. It seems that weak labour sector and high levels of inflation put pressure on the retail sales index. 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.

 

[LF.Anastasia]

CHF: Swiss Franc continues to step back

At the Forex currency market Swiss Franc rate almost stands still on Friday after yesterday's sales.

Forex forecast: MACD indicator for the pair USD/CHF is in the negative area; it has stopped decline and is moving along the signal line, not giving a clear signal. Stochastic Oscillator remains in the overbought zone, giving a buy signal.

Forex recommendations: in case of breakdown at 0.9190 the pair USD/CHF will go to 0.9210 and 0.9250. Consolidation close to the current levels is possible.

It became known earlier that CPI rose by 0.6% m/m (-1.0% y/y) in March against the forecast of growth of 0.4%m/m. However the Franc was more interested in the external background and ignored this statistics.

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

According to the data released earlier that consumption indicator UBS in Switzerland decreased to 0.87 points in February against preliminary level of 0.93 points.

In Q4 production in the manufacturing sector of Switzerland has declined again: volume of industrial output for the reporting period amounted to -1.4% y/y against the level of -1.9% in Q3. It became known earlier that imports rose by 0.7% y/y in February, to the level of14.04 billion francs, while imports rose only by 1.2% y/y last month 916.72billion francs) Trade balance amounted to 2.68 billion francs in February rising against the previous level of 1.5 billion francs. According to the data released earlier, unemployment rate in Switzerland amounted to 3.4% inFebruary- no changes.

Manufacturing sector is still weak in Switzerland, however it shows recovering trend. Index of induastial activity SVME rose to 49.0 points in February against the forecast of 48.5 points. Realretail 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 expectsthat inflation will amount from -0.6% to +0.6% in 2012-2014, GDP growth will beat the level of 1.0% this year.

At the last meeting of Swiss National Bank a three-month Libor rate was left unchanged at the level of 0%. In general, SNB's view on monetary policy remains unchanged.

 

[LF.Anastasia]

JPY: Japanese Yen strengthens due to increasing interest to “safe” currencies

At the Forex currency market the Japanese Yen continues to strengt hen slowly at the end of the week amid on going interest to "safe" harbours in the market.

Forex forecast: MACD indicator for the pair USD/JPY goes down in the positive area, while volumes are average 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 82.15 the pair USD/JPY will go to 82.10 and 82.00. Consolidation at the current levels is possible.

Interest in the JPY is easy to explain: investors move away from European risks and hedge their positions in the "safe" currency

Finance Minister of Japan Mr. Azumi said that the country continues to watch over the negotiations in Europe on establishing so-called protective barrier, the comment was given in response to expectations whether Japan would participate in the fight against European debt crisis through the investment to IMF.

Consumer sentiment index in Japan increased by 1.9 points in March, to the level of 55.6 points, against the level of -57.5 points in December. The data released on Tuesday showed that monetary base inJapan fell to -0.2% y/y in March versus the growth of 11.3% earlier. The headof the Bank of Japan Mr. Shirakawa stressed again that winning the fight against inflation in extremely important for the country. The country of the Rising Sun needs measures to stimulate growth rate; however, these measures andinfusions of the Central Bank will not improve the situation.

Retail sales grew by 3.5% y/y in February against expectations of growth of 3.3%. it is a favourable indication, although it shall be supported by further data.

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. Unemployment rate in Japan fell to 4.5% in February against the forecast of 4.6%. In addition, household spending rose by2.3% y/y in February against expectations of decline of 0.4% y/y. Net CPI roseby 0.1% y/y in February versus expectations of decline of 0.1% y/y. The data isvery positive indeed.

JPY was supported by the fact that it was theend of fiscal year, which finished in 31 March. All last week exporters have been brining revenues to the country, now this supportive factor is fading away.

 

[LF.Anastasia]

AUD: Australian Dollar is slowly recovering

At the Forex currency market the Australian Dollar rate demonstrates weak at tempts to recover on Friday, although most of the investors will be absent on Monday.

Forex forecast: MACD indicator for the pair AUD/USD went into the negative area, it has broken through thesignal line from top to bottom and is going down now, maintaining a sell signal. Stochastic Oscillator tends to go out of the oversold zone and is ready to shape a buy signal, however probability of it is low.

Forex recommendations: in case of breakdown at the level of 1.0320 the pair will go back to 1.0330 and 1.0350.

Macro-economic background in Australia is stable on Friday morning. Investors' low interest in risks may continue to affect the currency.

The currency is still affected by strong negative factor caused by the outcome ofthe meeting of RBA. A meeting of the Reserve Bank of Australia 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 feelanxious. 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 strong negative effect of European influence.

Reserve Bank of Australia statedlast week 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.

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

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 ofemployed 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 riseof 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 ofemployed 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.

 

[LF.Anastasia]

CAD: Canadian Dollar stands still

At the Forex currency market the Canadian Dollar almost stands still at the end ofthe week.

Forex forecast: MACD indicator for the pair USD/CAD is in the negative area, it has started to move along the signal lineand is not giving a clear signal. Stochastic Oscillator began is going up inthe neutral zone, giving a buy signal.

Forex recommendations: off the market.

Feasible event scenario at Forex: in case of breakdown at the level of 0.9930 the pair will go to 0.9920 and 0.9900. Consolidation near current levels is possible.

It became known yesterday that unemployment rate fell to 7.2% (-0.2%) in March. At the same time, employment rate increased by 82 thousand. We would remind that it is a positive tendency.The rate went down by 0.2% in February, although there had not been significant growth in a number of jobs.

In addition, yesterday's statistics showed that permits to construct in Canada increased by 7.5% m/m inFebruary, to the level of C$6.51 billion against the fall of 11.4% in January.

The head of the bank of Canada Mr. Carney noted earlier that economy of the country is growing slightly above the forecast and government possesses a number of tools to protect housing market from overheating. However, tools of monetary policy will be used only as thelast resort. Earlier Mr. Carney stressed that current interest rate is consistent with the monetary situation. Recall that in the middle of January the Bank of Canada left interest rate at the level of 1.0% per annum, which was not a surprise to the market. The bank of Canada expressed concern about the condition of the housing sector, according to the regulator, 10% decline inthis sector can lead to decrease in consumption of 1%, as the major volume of mortgage loans was used to finance consumption.

According to the data released earlier, GDP in Canada rose by 0.1% m/m (+1.75% y/y) in January versus revised value of+0.5% m/m (+1.9% y/y) which in general agreed with the forecast. Previous statistics demonstrated that economic growth in Canada slowed down: real GDP amounted to +0.4% m/m in December against the forecast of +0.3% m/m. All in all Canadian economy grew only by 0.4% in the last quarter last year against +1.0%in Q3. This was driven by strong external impact and decreasing interest inenergy resources at the end of the year.

Balance of current account amounted to CAD$10.33 billion in Q4 against expectations of CAD$9.6 billion. Prices for industrial goods in Canada rose by 0.3% in January versus the forecast of growth of 0.1%. Oil prices became the main driver of growth.

 

[LF.Anastasia]

EUR/USD: Euro starts the week with sales

The pair EUR/USD traded downward at the Forex currency market on Monday morning.

By 8.30 Moscow time the Euro is at 1.3060 against closing level of 1.3095 on Friday.

Most financial markets in the countries of West Europe as well as Australia and New Zealand are closed, due to Easter celebration, which reduces market activity.

Meanwhile investors are waiting for the following data: statistics from the Country of the Rising Sun which is expected to be weak, and the outcome of the meeting of the Bank of Japan on 9-10 of April.

Most likely, the pair EUR/USD will be in the range of 1.3010-1.3120 at the trading session on Monday.