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[LF.Anastasia]

AUD: Australian Dollar continues to rise

The Australian Dollar rate continues to rise at the Forex currency market on Thursday; however due to the decrease of investors’ interest to risk, the rise can be limited.

Forex forecast: MACD indicator is in the positive area for the pair AUD/USD and goes up; volumes are low which indicates the maintenance of the buy signal. Stochastic Oscillator keeps going down in the neutral zone, giving a pair sell signal.

Forex recommendations: off the market.

Feasible event scenario at Forex: in case of breakdown at the level of 1.0535 the pair will go to 1.0550 and 1.0570. If the level of 1.0510 is exceeded, the target will be the level of 1.0480.

Only minor Australian news was released today: volume of sales of the vehicles increased by 3.4% m/m (+1.9% y/y) in March against the growth by 0.2% m/m in February.

Yesterday Finance Minister of Australia Mr. Swan said that Australian economy is positive and will only benefit from economic growth of the developing countries. He thinks that although IMF has revised GDP forecast downward for Australia, country’s economy continues to recover. Note that IMF research showed that GDP forecast for Australia had been reduced to 3% in 2011 against the previous level of 3.5%. Floods in January partly impacted the revision of the forecast.

As it became known earlier lending in the housing sector fell by 5.6% m/m in February against the decline by 4.5% in January; according to the observers’ estimates the index collapsed due to the floods in the beginning of the year in Australia.

Macro-economic environment remains mixed in Australia. On the one hand unemployment rate reduced to 4.9% in March versus the prior level of 5.0% and employment rate rose by 37.8 thousand last month against the forecast of increase by 24 thousand. Therefore, strong performance in the employment sector pushed the AUD to go upward, instilling investors with the idea that the RBA can resume monetary tightening policy earlier.
On the other hand deficit of trade balance was recorded in the country for the first time since spring 2010 (February -А$205 billion against +A$1.4 billion in January). In addition activity index in the service sector reduced to 46.5 points in March against the value of 48.7 points in February.

According to the data released today level of consumer lending Westpac in Australia increased by 1.2%, to the level of 105.3 points in April against preliminary level of -2.4%. Such positive data has reflected public confidence in the prospects of economy. Following the meeting of the Reserve Bank of Australia last week it was decided to keep current level of the interest rate unchanged at the level of 4.75% per annum – it is the fourth time already when the RBA does not dare to continue monetary policy tightening.

 

[LF.Anastasia]

JPY: Japanese Yen tends to correction again

At the Forex currency market the Japanese Yen rate tends to correction again this morning because investors are interested in the JPY as a safe currency due to the U.S. unstable budget situation.

Forex forecast: MACD indicator is in the positive area for the pair USD/JPY and is going up, giving a pair buy signal. Stochastic Oscillator went down in the oversold zone today and continues to give a sell signal.

Forex recommendations: off the market.

Feasible event scenario at Forex: in case of breakdown at the level of 83.80 the pair will go to 84.00 and 84.20. If the pair exceeds the level of 83.45, correction will start at the level of 83.20.

It became known on Wednesday morning that starting from 18 April Ministry of Finance will begin to repurchase government bonds from the market in the amount of Y160 billion. Japanese Finance Minister Mr. Yosano noted yesterday that economic recession after the earthquake is temporary and by the end of the year the situation can improve in the Country of the Rising Sun. According to Yosano the main factor of uncertainty is instability of power supply and its possible shortage.

Statistics released this week showed that volume of orders for the basic production equipment in Japan reduced by 2.3% m/m in February for the first time in the last three months while a month earlier the index had increased by 4.2%. The indicator gives an idea about the amount of capital investments in production sector for the next 3-6 months. Thus, continuation of companies’ cost reduction threatens to the Japanese economy in addition to the fact that the situation in the business sector has already been very hard after the series of earthquakes and tsunamis.

Statistics released earlier was positive (unemployment rate amounted to 4.6% in February, unrevised; balance of current account increased by 3.0% y/y in February against the fall by 47.6% in January; level of import increased by 3.3% y/y, export rose by 4.1% y/y).

As noted in the minutes of the meeting of the Bank of Japan of 14 March released the day before yesterday, the earthquake of 11 March and subsequent devastating tsunami had a significant impact on the Japanese economy. Members of the Monetary Committee have agreed to continue soft policy and mitigate it further as soon as possible. The Bank of Japan expects deterioration in sentiments both within large companies, production and households.

 

[LF.Anastasia]

CAD: Canadian Dollar grows slightly

At the Forex currency market the Canadian Dollar rate continues to grow slightly.

Forex forecast: MACD indicator is in the negative area for the pair USD/CAD and goes down, giving a pair sell signal. Stochastic Oscillator goes up today in the neutral zone, giving a pair buy signal.

Forex recommendations: off the market.

Feasible event scenario at Forex: in case of breakdown at the level of 0.9610 the pair will go to 0.9630 and 0.9650. If the level of 0.9590 is exceeded, bears’ targets will become the levels of 0.9570 and 0.9555.

Yesterday the Bank of Canada stated that CPI in the country will start to rise, going up above expected level. At the same time value of key index of net CPI is also growing, remaining close to the target level of 2% so far.

Regulator expects that average annual growth of GDP will be at the level of 2.9% in Canada this year.

According to the experts from International Monetary Fund, Canadian economy will grow by 2.3% y/y this year which is less than the forecast of +2.7% y/y in October.

At the same time IMF expects that economy in Canada will rise by 2.7% in 1012. Exact data on the GDP growth in the country will be made public on 28 February, meanwhile IMF assumes that the index will be at the level of 2.9% (earlier – 3%).

In regards to the Canadian Dollar rate, IMF believes that if average oil price will remain at about $90 barrels (in October- $79 barrels), CAD will increase, with the help of support from the commodity sector of the country’s economy. Earlier Imperial Bank of Commerce reported on the revision of its GDP forecast for QIV 2010 to 2.6% versus the previous level of 2.3% and the Bank expects that this year economic growth will be by 2.6% (2.4 % earlier).

In general, CAD feels not bad at the moment.

 

[LF.Anastasia]

Euro/USD: Euro is still in the offset

The pair EUR/USD is traded slightly downward at the Forex currency market on Friday morning which was caused by the U.S. decision on the budget bill for the second half of the current fiscal year.

By 9.15 Moscow time the Euro is at 1.4473 against closing session level of 1.4487 yesterday.

Morning’s data from China where GDP and CPI rose above the forecast did not make investors happy- market believes that statistics will become an incentive to continue the process of cooling in the Chinese economy.

In general, major pair remains in the offset channel.
Most likely the pair EUR/USD will not go beyond the range of 1.4420-1.4520 at the trading session on Friday.

 

[LF.Anastasia]

GBP: British Pound is being corrected after two days of growth

At the Forex currency market the British Pound rate is being corrected on Friday morning after the leap yesterday.

Forex forecast: MACD indicator is in the positive area for the pair GBP/USD and goes up, giving a pair buy signal. Stochastic Oscillator goes upward in the neutral zone today, confirming a similar signal.

Forex recommendations: the level of 1.6300 can become a target for correction; after that the growth can resume.

No important information on Great Britain is scheduled for today; however a lot of news are expected on both Eurozone and the USA which can indirectly impact the balance of power in GBP/USD.

It became known yesterday that consumer confidence in Great Britain increased to 44 points in March, as per Nationwide study, against the level of 39 points in February. At the same time index of expenditure rose to 66 points versus the previous level of 53; expectation index went up to 66 points against the 51 previously. Therefore, confidence index in the UK has moved away from the lows, which is a positive factor for the British economy. The data released today showed that CPI in Great Britain grew by 0.3% m/m (+4.0% y/y) in March. Sterling sluggishly responded to this statistics – for over a year inflation in the UK has been considerably higher than the significant level of 2% to which the Bank of England adheres.

The data released earlier showed that CPI in Great Britain grew by 0.3% m/m (+4.0% y/y) in March. Sterling sluggishly responded to this statistics – for over a year inflation in the UK has been considerably higher than the significant level of 2% to which the Bank of England adheres.

The important data on the UK will be published on 27 April – it will be GDP in QI and monetary authorities hope to see the growth by 0.7%. If economic growth will be confirmed the rate can be increased to 0.75% per annum in the medium term.

At the meeting of the Bank of England last week the interest rate was kept at the level of 0.50% per annum, program of securities repurchase has remained in the previous volume as well. According to the minutes of the last meeting of the Bank of England, 6 members of MPC voted for keeping interest rate at the previous level. In addition 8 people voted for leaving current program of securities repurchase unchanged. Posen voted for the rise in the QE to 50 billion.

 

[LF.Anastasia]

CHF: Swiss Franc moves away from historic highs

At the Forex currency market Swiss Franc rate moves away from historic highs on Friday as the demand for the safe currency has slackened after the U.S. decision on the budget for the second half of the fiscal year with the decrease in government spending by more than $38 billion.

Forex forecast: MACD indicator for the pair USD/CHF is in the negative area, maintaining a pair sell signal. Stochastic Oscillator tends to come out of the oversold zone today, starting a pair buy signal.

Forex recommendations: if the level of 0.8950 is broken down, the pair will go to 0.8965 and 0.8980. If upward breakdown does not take place, the pair will consolidate close to the current levels.

It became known yesterday that index of investors’ economic expectations ZEW increased to 8.8 points in April against the fall by 13.5 points in February. It was a positive sign for Switzerland which confirmed the continuation of the national economy recovery even despite strong Franc. The data of this week demonstrated also that producer price index and prices for import increased by 0.4% y/y in March which agreed with the forecasts.

In general situation in Swiss economy has remained almost unchanged this morning. It became known earlier that actual level of retail sales in Switzerland rose by 1.5% m/m in February against the fall by 2.4% m/m in January. However index of SVME-PMI fell to 59.3 points in March against the previous value of 63.5. According to the data released yesterday level of CPI in Switzerland rose by 0.6% m/m (+1,0% y/y) in March against the forecast of growth by 0.2% m/m. It is a ambiguous factor for Swiss economy as on the one hand the economy strengthens and on the other hand it suffers from significant inflationary pressure.

Three- month Libor rate remains unchanged, at the level of 0.25%.

Representative of the regulator Mr. Dantin stressed that the Bank is capable to ensure price stability even amid excess liquidity. In addition the politician said that the cost of intervention in the currency market will be determined by the informational pressure.

The SNB has highlighted the problems not once: following the last meeting, the regulator said that strong currency is a burden for the economy and its overprice will trigger slowdown in economic growth – largely due to the deceleration in export volumes.

 

[LF.Anastasia]

JPY: Japanese Yen tries to rise again

The Japanese Yen rate does not give up its attempts to rise in pairing with the USD at the Forex currency market on Friday.

Forex forecast: MACD indicator is in the positive area for the pair USD/JPY and si moving along the signal line, not giving a clear signal, although the volumes remain high. Stochastic Oscillator has come into the oversold zone on Friday and is giving a pair sell signal.

Forex recommendations: off the market.

Feasible event scenario at Forex: in case of breakdown at the level of 83.45 the pair will go to 83.50 and 83.70. If the level of 83.10 is exceeded, traders’ targets will become the levels of 83.00 and 82.90.

Today’s statistics showed that the revised volume of industrial output in Japan rose by 1.8% m/m in February against the preliminary level of +0.9%. This is a mediate indicator for the Yen because it shows the situation prior to the earthquake in March. Statistics released this week showed that volume of orders for the basic production equipment in Japan reduced by 2.3% m/m in February for the first time in the last three months while a month earlier the index had increased by 4.2%. The indicator gives an idea about the amount of capital investments in production sector for the next 3-6 months. Thus, continuation of companies’ cost reduction threatens to the Japanese economy in addition to the fact that the situation in the business sector has already been very hard after the series of earthquakes and tsunamis.

Statistics released earlier was positive (unemployment rate amounted to 4.6% in February, unrevised; balance of current account increased by 3.0% y/y in February against the fall by 47.6% in January; level of import increased by 3.3% y/y, export rose by 4.1% y/y).

It became known on Wednesday morning that starting from 18 April Ministry of Finance will begin to repurchase government bonds from the market in the amount of Y160 billion. Japanese Finance Minister Mr. Yosano noted yesterday that economic recession after the earthquake is temporary and by the end of the year the situation can improve in the Country of the Rising Sun. According to Yosano the main factor of uncertainty is instability of power supply and its possible shortage.

 

[LF.Anastasia]

AUD: Australian Dollar has not determined movement direction yet

At the Forex currency market the Australian Dollar rate is traded downward on Friday, as it is determining movement direction.

Forex forecast: MACD indicator is in the positive area for the pair AUD/USD and goes up, giving a pair buy signal. Stochastic oscillator tends to rise in the neutral zone today, shaping a similar signal.

Forex recommendations: after the correction a target of the pair’s growth can be the levels of 1.0540 и 1.0580.

Today’s decline of the AUD is explained by strong statistics on China released today, which makes market suggest that continuation of the economic cooling process in China is possible.

Earlier Finance Minister of Australia Mr. Swan said that Australian economy is positive and will only benefit from economic growth of the developing countries. He thinks that although IMF has revised GDP forecast downward for Australia, country’s economy continues to recover. Note that IMF research showed that GDP forecast for Australia had been reduced to 3% in 2011 against the previous level of 3.5%. Floods in January partly impacted the revision of the forecast.

Macro-economic environment remains mixed in Australia. On the one hand unemployment rate reduced to 4.9% in March versus the prior level of 5.0% and employment rate rose by 37.8 thousand last month against the forecast of increase by 24 thousand. Therefore, strong performance in the employment sector pushed the AUD to go upward, instilling investors with the idea that the RBA can resume monetary tightening policy earlier. On the other hand deficit of trade balance was recorded in the country for the first time since spring 2010 (February -А$205 billion against +A$1.4 billion in January). In addition activity index in the service sector reduced to 46.5 points in March against the value of 48.7 points in February.

According to the data released this week the level of consumer lending Westpac in Australia increased by 1.2%, to the level of 105.3 points in April against preliminary level of -2.4%. Such positive data has reflected public confidence in the prospects of economy. Following the meeting of the Reserve Bank of Australia last week it was decided to keep current level of the interest rate unchanged at the level of 4.75% per annum – it is the fourth time already when the RBA does not dare to continue monetary policy tightening.

 

[LF.Anastasia]

NZD: New Zealand Dollar tends to rise

At the Forex currency market the New Zealand Dollar rate continues to rise today, reaching local highs once again.

Forex forecast: MACD indicator is in the positive area for the pair NZD/USD and is growing, giving a pair buy signal. Stochastic Oscillator remains in the oversold zone today, giving a pair buy signal.

Forex recommendations: in case of breakdown at the level of 0.7960 the pair will go to 0.7990. If a breakdown does not take place the pair will consolidate close to the current levels.

It became known yesterday that the index of industrial activity PMI in New Zealand declined to 50.1 points in February against the level of 53.2 points in February. Statistics has not affected the positions of the NZD.

Statistics released earlier this week was mixed: index of houses prices REINZ increased by 0.5% in March against preliminary forecast of growth by 2.3%; while sale of houses reduced by 5.1% last month against preliminary level of -10.5%. In addition prices for food rose by 0.3% in March against preliminary target of -10.5%. In addition prices for food increased by 0.3% in March against the preliminary target of 0.1%. Earlier the country reported that trade surplus was positive for the first time in the last 8 months. High raw material prices which have been maintained in the world market became a catalyst for this, as well as the growth of export levels of timber and dry milk. Exports increased by 17% y/y in February; imports – by 23% y/y, to the level of 3.86 billion of NSD. Exports in New Zealand amounts to about 30% of the total GDP level and the increase in this article will have a positive impact on the national economy.

In addition it also became known that the level of business confidence in New Zealand declined by 27% in QI, as per NIESR estimates against the level of +8 points in QIV.

The data of March has not been very impressive either: business confidence index NBNZ fell to -8.7 in New Zealand against 34.5 in the previous period. It is difficult to judge which factor has caused such rollback and it is worth waiting for the new data to be able to speak about one or another trend.

There is a strong speculative component in the pair NZD/USD at the moment which makes it possible for the NZD not to respond to the fundamental aspects.

 

[LF.Anastasia]

GBP: British Pound started the week with decline

At the Forex currency market the British Pound Sterling rate is decreasing on Monday morning, continuing dynamics of the end of last week.

Forex forecast: MACD indicator is in the positive area for the pair GBP/USD and is going up, however the volumes do not increase indicating a pause in the pair buy signal. Stochastic oscillator is going up a slightly today in the positive zone.

Forex recommendations: in case of breakdown at the level of 1.6300 the pair will go to 1.6320 and 1.6345. If a break upward does not take place, the pair will consolidate close to the current levels.

It became known today that house price index in Great Britain increased by 1.7% m/m (+0.1% y/y) in April, as per Rightmove estimates. This has not affected the trades yet.

Earlier it became known that consumer confidence in Great Britain increased to 44 points in March, as per Nationwide study, against the level of 39 points in February. At the same time index of expenditure rose to 66 points versus the previous level of 53; expectation index went up to 66 points against the 51 previously. Therefore, confidence index in the UK has moved away from the lows, which is a positive factor for the British economy. The data released today showed that CPI in Great Britain grew by 0.3% m/m (+4.0% y/y) in March. Sterling sluggishly responded to this statistics – for over a year inflation in the UK has been considerably higher than the significant level of 2% to which the Bank of England adheres.

Statistics released earlier showed that CPI in Great Britain grew by 0.3% m/m (+4.0% y/y) in March. Sterling sluggishly responded to this statistics – for over a year inflation in the UK has been considerably higher than the significant level of 2% to which the Bank of England adheres.

Important data on the UK will be published on 27 April – it will be GDP in QI and monetary authorities hope to see the growth by 0.7%. If economic growth will be confirmed the rate can be increased to 0.75% per annum in the medium term. Interest rate was kept at the level of 0.50% per annum, program of securities repurchase also remained in the previous volume.