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[LF.Anastasia]

AUD: Australian Dollar stands still

At the Forex currency market the Australian dollar rate stands still on Thursday due to lack of new catalysts for movement.

Forex forecast: MACD indicator for the pair AUD/USD goes up moderately in the negative area and is giving a buy signal while volumes are average. Stochastic Oscillator is sliding down in the neutral zone and is giving a signal for moderate selling.

Forex recommendations: off the market.

Feasible event scenario at Forex: in case of breakdown at the level of 1.0360 the pair will go back to 1.0370 and 1.0380. If aggressive sellers will be back in the pair, the target for sale will be at the level of 1.0300.

Prime Minister of Australia Julia Gillard said on Thursday that government is still determined to preserve budget surplus. It is very important for Australia, especially taking into account that binds with China are very strong.

It became known this morning that leading indicator index Westpac in Australia rose by 0.2% in February, up to 284.2 points against preliminary expectations of growth of 0.6%. At the same time, growth rate amounted to 2.4% against predicted 2.5%. Representatives of Westpac commented that negative dynamics in the growth rate over the past six months does not raise enthusiasm about prospects and experts do not expect improvements in the nearest future. In general, current indexes meet expectations of the Australian economic development in 2012 (3%), however growth rate of GDP remains below trend.

The Reserve Bank of Australia stated earlier that funding problems can be preserved in the country this year, despite the fact that access to funding has become much easier for many banks. The RBA especially emphasized that uncertainty in Europe and slowdown in the global economy can adversely affect Australian economic system.

It became known earlier that employment rate in Australia increased by 44 thousand in February against expectations of 6.5 thousand. Unemployment rate amounted to 5.2% against previous level of 5.3%.

Minutes of the meeting of the Reserve Bank of Australia held in April indicated that with slowdown in economic growth, chances of lowering interest rate this year have increased. The documents also said that monetary politicians had lowered their forecasts for economic growth in the country. It also specified that if decline in inflation will be more significant, the RBA will have to commence further softening of the monetary policy.

Next report on inflation will be released on 24 April; it will show CPI for Q1.

 

[LF.Anastasia]

CAD: Canadian Dollar is in complete uncertainty today

At the Forex currency market the Canadian dollar rate is almost not moving on Thursday, as external background is ambiguous at the trading session today and there are no new drivers for movement yet.

Forex forecast: MACD indicator for the pair USD/CAD goes along the signal line in the positive area, and is not giving a clear signal. Stochastic Oscillator goes down in the neutral zone, giving a sell signal.

Forex recommendations: in case of breakdown at the level of 0.9900 the pair will go to 0.9890 and 0.9870. Consolidation near current levels is possible.

It became known yesterday that the Bank of Canada is going to gradually raise interest rate throughout 2014 and in general it is consistent with the policy that the regulator has outlined earlier.

Meeting of the Bank of Canada was very lively, despite the fact that the Regulator had left interest rate at the level of 1% per annum, as expected. However, comments which were made by the Governor of the Bank of Canada Mr. Carney were unexpected for the market. Thus, monetary politician noted that the rise in the interest rate can be a reasonable decision in the future, as both inflation and economic growth may accelerate. According to the forecasts made by the Bank of Canada, economy of the country will have maximal productivity starting from the first part of 2013.

Unemployment rate in Canada fell to 7.2% (-0.2%) in March. Level of employed increased by 82 thousand. Note, that it is a positive trend, as unemployment rate in February fell by 0.2%, although number of jobs did not rise significantly in the last month of winter. In addition, permits to construct in Canada rose by 7.5% m/m in February to 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 has number of tools in order to protect housing market from overheating. However, instruments of monetary policy will be used only as the last resort.

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.

It became known earlier that sales in the secondary housing market rose by 2.5% m/m (+1.6% y/y) in March, which a good indication.

 

[LF.Anastasia]

EUR/USD: Euro continues to move slowly

The pair EUR/USD traded slightly upward in the Forex currency market on Friday morning.

By 8.30 Moscow time the Euro was at 1.3144 against yesterday’s closing session level of 1.3136.

The pair Euro/USD does not have special reasons to grow- the U.S. statistics released yesterday was very weak. Investors are getting concerned that a new round of debt problems may start in Eurozone.

Moreover, Spanish auction, which took place yesterday, went on smoothly, the country was able to place all planned volume of bonds. However it does not reassured the market: yields of ten-year old bonds continue to rise.

Macro-economic calendar is uneventful today; therefore external background will remain the main driver for movement in the market.

Most likely, the pair EUR/USD will not go beyond the range of 1.3070-1.3170 at the trading session on Friday.

 

[LF.Anastasia]

GBP: British Pound is full of strength

The British Pound Sterling rate traded upward at the Forex currency market on Friday, continuing to grow steadily.

Forex forecast: MACD indicator for the pair GBP/USD remains in the positive area; it is moving along the signal line again, while volumes are average and is not giving a clear 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 1.6070 the pair GBP/USD will go to 1.6080 and 1.6100. Consolidation near the current levels is possible.

According to representative of the Bank of England Mr. Pousen, there is evidence, indicating positive momentum of growth. Monetary politician believes that inflation will not exceed target level of 2% until the end of this year. At the same time, levels of consumer confidence, affected by weak data on GDP, is a cause for concern.

It became known earlier that unemployment rate in the UK amounted to 4.9% in March. Level of unemployed rose by 3.6 thousand.

Information, that rating agency A&P has confirmed rating of Great Britain at the top level of AAA, has become a new catalyst for growth. Prime-Minister Cameron commented that the rates should be kept low in order to be able to stimulate economic growth.

Representative of the Bank of England Mr. Tucker said earlier that inflation in the UK is still above the target level; it is also highly possible that CPI will definitely remain above 3% in Q2 or probably through the whole period of the second half of 2012. At the same time, Tucker did not rule out that due to construction sector, economic growth in Q1 can be zero.

Consumer confidence GFK/NOP declined to -31 points in March against the level of -29 points. The data indicates strong destabilization in the British economy.

The data released earlier 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 opened less than one year ago, rose by 1.3% y/y in March, while the index went down in January and February. However, it is worth noting that reaction of the Bank of England to this statistics was not very enthusiastic. The rise in unemployment and high oil prices can impede growth in demand.

 

[LF.Anastasia]

CHF: Swiss Franc is slightly growing

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

Forex forecast: MACD indicator for the pair USD/CHF has broken through the signal line from bottom to the top and is now in the positive area; however it is moving along the signal line and is not giving a clear signal. Stochastic Oscillator goes down in the neutral zone. It has almost merged with the signal line and is ready to enter into oversold zone, maintaining a sell signal.

Forex recommendations: in case of break down at the level of 0.9130 the pair USD/CHF will go to 0.9120 and 0.9100. Consolidation at the current levels is possible.

Macro-economic background is quiet in Switzerland on Friday morning.

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.

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.

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. Despite strong determination of SNB to maintain the level at 1.20, assumption about probability, that pegging level of Franc to Euro will go to 1.25, is getting more persistent in the market.

So, after three months break Swiss National Bank has a new governor- this is Mr. Jordan who has performed the duties since January when Mr. Hildebrand left his post. Jordan has already said that he would continue to adhere to the old monetary policy and is going to preserve the level of 1.20 in the pair EUR/ CHF. According to him, Franc is still overvalued.

In general, views of the new governor found support in SNB. The Bank members believe that considering problems in the Eurozone, pegging of Franc to the Euro is still required.

 

[LF.Anastasia]

JPY: Sales for Japanese Yen have been suspended

At the Forex currency market the Japanese Yen rate traded slightly upward on Friday after three days of sales

Forex forecast: MACD indicator for the pair USD/JPY has broken through the signal line from top to bottom and continues to go down, maintaining a signal for moderate sales. Stochastic Oscillator has come into overbought zone and is giving a buy signal.

Forex recommendations: in case of breakdown at the level of 81.60 the pair USD/JPY will continue to strengthen and will go to 81.70 and 81.90. Consolidation near the current levels is possible at the end of the week.

Apparently the JPY has had “corrected” sufficiently, moving away from local highs in order to stop sales.

Trade deficit in Japan amounted to Y82.6 billion in March against the level of Y226.3 billion in February. This data is positive; other sections of the report also demonstrated that exports rose by 5.9% y/y last month, imports increased by 10.5% y/y.

Unemployment rate in Japan fell to 4.5% in February against the forecast of 4.6%. Consumer confidence index in Japan rose to 40.3 points in March against the level of 39.9 points in February. It is a good indicator which gives grounds to expect “new shoots” in the economy of the country.

Retail sales rose by 3.5% in February against expectations of growth of 1.3%. Real revised GDP amounted to -0.2% q/q (-0.7% y/y) in Q4. In addition, 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.

According to representative of the Bank of Japan Mr. Nasimury, measures taken by the Bank of Japan in February helped to stabilize exchange rate of the Yen and stimulate stock market; therefore, the regulator is ready to take more actions if required. Monetary politician stressed yesterday that Central Bank is going to make vigorous efforts in the sphere of monetary policy in order to achieve planned inflation target at 1%, the major risk factor is - overall slowdown in the world economy.

Regular meeting of the Bank of Japan last 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 disagreed with the opinion of Japanese government, who would like to see more dynamic stimulation of the economy.

 

[LF.Anastasia]

AUD: Australian Dollar failed to summon energy to grow

At the Forex currency market the Australian dollar rate is still hesitant at the end of the week.

Forex forecast: MACD indicator for the pair AUD/USD goes up moderately in the negative area and is giving a buy signal while volumes are average. Stochastic Oscillator is sliding down in the neutral zone and is giving a signal for moderate selling.

Forex recommendations: off the market.

Feasible event scenario at Forex: in case of breakdown at the level of 1.0350 the pair will go back to 1.0360 and 1.0380. If aggressive sellers will be back in the pair, the target for sale will be at the level of 1.0300.

It became known today that import price index in Australia fell by 1.2% q/q in Q1 against the forecast of -0.6% q/q. At the same time, export prices fell to the lowest level since Q4 2010.

Theoretically, decline in export prices was caused by reduction in price for crude ore extracted in Australia and fall in the price for metal scrap. At the same time, slump in imports was caused by expensive AUD.

Prime Minister of Australia Julia Gillard said on Thursday that government is still determined to preserve budget surplus. It is very important for Australia, especially taking into account that binds with China are very strong.

It became known earlier that employment rate in Australia increased by 44 thousand in February against expectations of 6.5 thousand. Unemployment rate amounted to 5.2% against previous level of 5.3%.

Minutes of the meeting of the Reserve Bank of Australia held in April indicated that due to slowdown in economic growth, chances of lowering interest rate this year have increased. The documents also stated that monetary politicians had lowered their forecasts for economic growth in the country. It also specified that if decline in inflation would be more significant, the RBA would be forced to commence further softening of the monetary policy. Next report on inflation will be released on 24 April; it will show CPI for Q1.

It became known earlier that leading indicator index Westpac in Australia rose by 0.2% in February, up to 284.2 points against preliminary expectations of growth of 0.6%. At the same time, growth rate amounted to 2.4% against predictions of 2.5%. Representatives of Westpac commented that negative dynamics in the growth rate over the past six months does not help to raise enthusiasm about prospects and experts do not expect improvements in the nearest future. In general, current indexes meet expectations of the Australian economic development in 2012 (3%). However, growth rate of GDP remains below trend.

The Reserve Bank of Australia stated earlier that funding problems can be preserved in the country this year, despite the fact that access to funding has become much easier for many banks. The RBA especially emphasized that uncertainty in Europe and slowdown in the global economy can adversely affect Australian economic system.

 

[LF.Anastasia]

CAD: Canadian Dollar is undetermined at the end of the week

At the Forex currency market the Canadian dollar rate is undetermined at the end of the week largely due to mixed external signals.

Forex forecast: MACD indicator for the pair is in the positive area and is moving along the signal line, not giving a clear signal. Stochastic Oscillator started to go up in the neutral zone, giving a buy signal.

Forex recommendations: in case of breakdown at the level of 0.9950 the pair will go to 0.9960 and 0.9970. Consolidation near the current levels is possible at the end of the week.

There have not been changes in the economy of Canada in the end of the week; nevertheless, dynamics of oil prices and demand for risk continue to be of interest to investors to some extent.

Unemployment rate fell to 7.2% (-0.2%) in March. Level of employed increased by 82 thousand. Note, that it is a positive trend, as unemployment rate in February fell by 0.2%; number of jobs has not increased significantly in the last month of winter. In addition, permit to construct in Canada rose by 7.5% m/m in February to 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 has number of tools in order to protect housing market from overheating. However, instruments of monetary policy will be used only as the last resort.

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 has slowed down in Q4: real GDP amounted to +0.4% m/m in December against the forecast of +0.3% m/m. All in all, economic growth in Canada went up only by 0.4% in the last quarter last year against +1.0% in Q3.This is a good result.

It became known earlier that the Bank of Canada is going to gradually raise interest rate throughout 2014; in general, it is consistent with the policy that the regulator has outlined earlier. Meeting of the Bank of Canada was very brisk, despite the fact that the Regulator had left interest rate at the level of 1% per annum, as expected. However, comments which were made by the Governor of the Bank of Canada Mr. Carney were unexpected for the market. Thus, monetary politician noted that the rise in the interest rate can be a reasonable decision in the future, as both inflation and economic growth may accelerate.

According to the forecasts made by the Bank of Canada, economy of the country will regain its full capacity in the first half of 2013.

 

[LF.Anastasia]

EUR/USD: Decision on G20 holds Euro back from sales

The pair EUR/USD traded slightly upward at the Forex currency market on Monday morning; however it is still below closing level on Friday.

By 8.20 Moscow time the Euro is at 1.3193 against closing session level of 1.3218 on Friday.

News, that reserves of the International Monetary Fund can be increased by $430 billion, holds the Euro back from sales. This decision was adopted by members G20 last weekend. Totally the IMF needs expansion of the reserves by $500 billion; therefore the agreed amount seems optimal at the moment

However, the USD is gaining strength in advance of the meeting of the U.S. Federal Reserve which will be held on 24-25 April.

The day is going to be quiet in terms of macro-statistics; investors will be interested in the data from Europe in the afternoon. There is no news on the USA on Monday.

Most likely the pair EUR/USD will not go beyond the range of 1.3120-1.3220 at the trading session on Monday.

 

[LF.Anastasia]

GBP: British Pound is confused at the beginning of the week

The British Pound Sterling rate traded slightly downward at the Forex currency market in the beginning of the week in response to ambiguous external background and due to the fact that local currency is overbought.

Forex forecast: MACD indicator for the pair GBP/USD remains in the positive area; it goes up, while volumes are high, and is giving a buy signal. Stochastic Oscillator has come into overbought zone and is giving a similar signal.

Forex recommendations in case of breakdown at the level of 1.6120, the pair GBP/USD will go to 1.6130 and 1.6150. Consolidation near the current levels is possible.

Macro-economic background in the UK is quiet on Monday morning.

The data on retail sales, released on Friday, was beneficial of the GBP: thus, volume of retail sales in March increased by 1.8% m/m (+3.3% y/y) against the forecast of growth of 0.4%. This was much above expectations.

Information, that rating agency A&P has confirmed rating of Great Britain at the top level of AAA, has become a new catalyst for growth last week. Prime-Minister Cameron commented that the rates should be kept low in order to be able to stimulate economic growth.

Representative of the Bank of England Mr. Tucker said earlier that inflation in the UK is still above the target level; it is also highly possible that CPI will definitely remain above 3% in Q2 or probably through the whole period of the second half of 2012. At the same time, Tucker did not rule out that due to construction sector, economic growth in Q1 can be zero.

Consumer confidence GFK/NOP declined to -31 points in March against the level of -29 points. The data indicates strong destabilization in the British economy.

The data released earlier 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 opened less than one year ago, rose by 1.3% y/y in March, while the index went down in January and February. However, it is worth noting that reaction of the Bank of England to this statistics was not very enthusiastic. The rise in unemployment and high oil prices can impede growth in demand.

According to representative of the Bank of England Mr. Posen, there is evidence, indicating positive momentum of growth. Monetary politician believes that inflation will not exceed target level of 2% until the end of this year. At the same time, levels of consumer confidence, affected by weak data on GDP, is a cause for concern.

It became known earlier that unemployment rate in the UK amounted to 4.9% in March. Level of unemployed rose by 3.6 thousand.