The Pound is waiting for the Brexit news. Overview for 16.10.2019

GBPUSD is trading close to May’s highs; investors’ attention is focused on the Brexit deal draft.

The British Pound moved a bit away from yesterday’s highs, but may yet continue rising. The current quote for GBPUSD is 1.2756.

Last night, the Pound was pretty popular in the view of talks about the Brexit deal draft prepared by the United Kingdom and the European Union. They said that the draft might appear in the media on Wednesday morning, but there hasn’t been any news about it so far.

Meanwhile, the talks continue. On Thursday, the EU is set to have the Brexit summit and some of the documents had to be ready at the opening.

It seems like the Pound will remain volatile in the next 24 hours, so investors may try to benefit from everything that is relating to the Brexit procedure.

The statistics published yesterday showed that the Unemployment Rate rose from 3.8% in August to 3.9% in September. The Claimant Count Change was 21.1K, bringing the total amount to 1.31M. The Average Earnings Index added 3.8% 3m/y against the expected reading of +4.0% 3m/y.

Overall, the British labor market is estimated as stable and neutral, and the August decline might have been temporary. In this light, it will be interesting to check on September numbers.

Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

The Euro is trading at 6 weeks highs. Overview for 18.10.2019

The major currency pair continues rising influenced by Brexit positive.

EURUSD intends to continue its growth on Friday. The current quote for the instrument is 1.1124.

The major currency pair is feeling fine while being supported by the news that the United Kingdom and the European Union agreed on the Brexit deal. The Euro did feel nervous while policymakers were trying to reach consensus, so now it is regaining its positions.

Yesterday, the USA published a lot of numbers. First of all, the weekly Unemployment Claims report, which showed 214K against 201K last week. It’s not critical.

The Housing Starts declined in September and was only 1.26M after being 1.39M in August and against the expected reading of 1.32M. The same for the Building Permits: 1.39M in September against 1.43M the month before.

The Capacity Utilization Rate dropped from 77.9% to 77.5%. The indicator really was anticipated to fall, but the final reading was worse than expected. The Industrial Production lost 0.4% m/m in September after adding 0.8% m/m in the previous month. In the case of this indicator, some decline was also expected, but no one thought it would be so serious. However, this bad news has a quite conceivable reason: there were strikes at General Motors, which had a significant influence on the volume of car output and spare parts. The future outlook for the company still remains uncertain in the light of the global demand decline. In addition to that, the entire sector is looking rather weak due to trade wars between the USA and China.

In the future, the indicators may return into a positive area after trade agreements are signed or arranged at least, but it will take the manufacturing sector some time to recover and feel itself better.

Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

The Euro is saving strengths. Overview for 22.10.2019

On Tuesday morning, the major currency pair is waiting for the Brexit news and saving strengths in anticipation of the ECB meeting.
EURUSD is consolidating without any particular direction on Tuesday. The current quote for the instrument is 1.1155.

So far, there is no news relating to the Brexit as the Parliament Brexit Vote is scheduled for 12:30 GMT. That’s why the best thing for investors to do is saving strengths.

This Thursday, October 24th, the European Central Bank is set to have another meeting. There are two key points here. The first one is that this will be the last meeting of the regulator in 2019. The second one – it will be the last meeting Mario Draghi acts as the ECB Governor. On November 1st, 2019, Christine Lagarde will take the office and become the first woman in the position of ECB President. It is her, who will assess the results of the QE announced earlier and expand the list of stimulus tools. Sooner or later, she will have to do this, there are no doubts about it.

The tools the ECB has aren’t very numerous. It might well be that the regulator will have to slowly decrease the interest rate, but let's not run ahead.

it is obvious that the last ECB meeting “hosted” by Mario Draghi may pass without any disturbances, although one should admit that the European economy has significantly deteriorated since the previous meeting. Market players are waiting for an assessment of existing problems, at least, and that may weaken the Euro.

Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

The Euro is keeping balance. Overview for 24.10.2019

On Thursday, EURUSD remains stable; it is still waiting for the news.

The major currency pair is quite inactive on Thursday morning – there will be a busy day ahead. The current quote for the instrument is 1.1135.

The statistics published yesterday showed that the Consumer Confidence in the Euro Area deteriorated and was -8 points in October after being -7 points in the previous month. It’s not good news for the European currency, but not surprising at the same time. 

There will be a lot of October numbers from Europe today, such as the Manufacturing and Services PMIs from Germany, France, and the Euro Area itself. All reports are preliminary and barely expected to have any influence on the major currency pair. However, they may provide insight into what is currently happening in the region.

In the afternoon, the European Central Bank is scheduled to have another meeting. Everything has already been said, but the regulator’s comments might be interesting.

Later in the afternoon, market players should pay attention to the September Durable Goods Orders report from the USA, which is expected to show -0.5% m/m after adding 0.2% m/m the month before. The indicator is extremely volatile and changes all the time, that’s why one should carefully read the components of the report even if the numbers are weak.

Apart from this, the USA is going to report on the New Home Sales in September, which may drop from 713K to 710K. This decline is not critical and can be easily explained by the current imperfect situation on the real estate market.

Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

They stopped selling the Euro. Overview for 28.10.2019

On Monday, EURUSD stopped falling; right now, it is consolidating close to week’s lows.

The major currency pair is quite calm early in the week, but there will be a lot of reasons to be more active later this week. The current quote for EURUSD is 1.1088.

There will be several events that may influence the Euro behavior. First of all, it’s a meeting of the US Federal Reserve. The key anticipated thing is whether the regulator is going to continue cutting the rate or not in the future, that’s why investors’ attention will be focused on the comments following the meeting. As for the rate decision itself, no one has any doubts that the regulator will decrease it down to 1.50-1.75% this time. However, this was already shown up in EURUSD prices, so there might be no significant fluctuations at all.

Secondly, this Friday the ECB Governor Mario Draghi will step aside from his position in favor of Christine Lagarde. Market players do not expect any serious changes in the regulator’s policy, but they are surely eager to hear first comments from Lagarde, a new head of the ECB, who is a very experienced monetary policymaker. Mid-term market expectations imply that the regulator might have to change its monetary policy earlier than predicted before due to a decline in the Euro Area GDP and a lot of targeted problems in several European countries.

There will be some statistics worth paying attention to. For example, the USA is scheduled to report on the GDP for the third quarter. Although the report isn’t likely to contain any numbers to impress investors, the market will be volatile whatever the case.

Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

The Yen is slowly rising. Overview for 30.10.2019

USDJPY is falling a little bit in the middle of the week; investors prefer to avoid risks in anticipation of the US Federal Reserve meeting.

The Japanese Yen is getting a bit stronger against the USD on Wednesday. The current quote for the instrument is 108.83.

In the morning, Japan published a rather interesting report on Retail Sales in September. The indicator added 9.1% y/y after showing +1.8% y/y in August; it was really expected to improve, but not by so much.

Most of all, consumers were buying general merchandise (+ 13.9%), motor vehicles (+16.9%) and machinery & equipment (+37.9%). However, it seems quite reasonable: starting October 1st, the sales tax in Japan went up from 8% to 10%, that’s why people were buying rather expensive things that were expected to get even more expensive, given the fact that Japanese households are usually very careful with spending money when the financial outlook in the country isn’t very bright.

As a result of the sales tax increase, quite a lot of money will be credited to the country’s budget, but everyone understands that the Retail Sales indicator won’t continue skyrocketing.

Investors are “dormant” today as they are waiting for the US Federal Reserve two-day meeting to be over on Wednesday night. As usual, this event tends to be pretty emotional for market players, that’s why they prefer to save strengths until some important information is released.

Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

The Australian Dollar intends to continue rising. Overview for 01.11.2019

AUDUSD was correcting a little bit after hitting its two months high, but right now it is ready to continue growing.

The Australian Dollar continues rising against the USD early in November. The current quote for the instrument is 0.6907.

Today’s statistics from Australia were rather minor, but the Aussie doesn’t seem upset. The AIG Manufacturing Index dropped from 54.7 points in September to 51.6 points in October, which means that managers of the largest Australian companies see signs of deterioration of market conditions. Of course, it’s not a good signal for the country.

Meanwhile, the Producer Price Index in Australia added 0.4% q/q in the third quarter, just as expected. As for this indicator, everything is fine, although there were no reasons to worry in the first place.

The Aussie positively responded to the statistics from China, which is the country’s key trade and economic partner. The Caixin Manufacturing PMI in China expanded up to 51.7 points in October after being 51.4 points in the previous month. An increase in business activity in this sector may signal that market risks regarding trade wars are going down and that‘s very good.

Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

The Euro continues falling. Overview for 07.11.2019

EURUSD has been falling for the fourth consecutive trading session; market players are hoping for the better.

The major currency pair continues falling on Thursday morning. The current quote for the instrument is 1.1062.

The key catalyst on the market remains the same: investors are hoping that the USA and China, who are actively working on the first phase of their trade agreement, will sign it in the nearest future. Market expectations imply November, which means that it may happen onу ща these days. This, in its turn, reduces the interest in “safe haven” assets and makes the American currency stronger.

It’s obvious that the parties, both the USA and China, need the deal. However, the time passes by, negotiations are impeded, although news media says that they keep going.

Yesterday, the Euro Area reported on the Retail Sales in September, which added 0.1% m/m, the same as expected. However, it’s worse than the August reading, which was revised upwards, from +0.3% m/m to +0.6% m/m, and that’s a good signal. Probably, season sales had their effect.

There will be a meeting of the Eurogroup today, while the European Commission is going to publish its Economic Forecasts. If there are no surprises here, the Euro will remain under pressure from the current drivers and catalysts. Later in the evening, the USA is scheduled to report on the Consumer Credit in September, which is expected to go from 17.9B to 15.6B.

Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

The Euro starts consolidating. Overview for 11.11.2019

The major currency pair is quite confident early in another November week.

EURUSD is no longer falling this morning; right now, it is consolidating. The current quote for the instrument is 1.1026.

Last Friday, the US President Donald Trump said that he wasn’t ready yet to consider the possibility of completely removing import tariffs on Chinese goods introduced earlier. That’s not good news, because investors are already tensed enough because of the trade agreement between these countries, which hasn’t been signed yet.

There were such rumors before: all these talks that after signing the first phase of the trade deal the parties might remove import duties on each other’s goods crashed into the White House’s tough stance.

However, right now there is neither fixed date of signing the agreement nor other nuances or details. Nevertheless, investors believe that the deal will be made in the nearest future because both the USA and China need it badly.

The USA celebrates Veterans Day today, so the markets are off. The Euro Area won’t provide any interesting statistics as well, that’s why investors in the major currency pair are left to their own devices. The European numbers that might really attract market players’ attention will be published not earlier than Thursday: the preliminary report on the Euro Area’s GDP in the third quarter of 2019.

Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

The New Zealand Dollar skyrocketed. Overview for 13.11.2019

On Wednesday, NZDUSD updated its weekly highs after the Reserve Bank of New Zealand kept the key interest rate intact.

The New Zealand Dollar cheered up after the RBNZ’s decision to leave the interest rate unchanged during its November meeting. The current quote for NZDUSD is 0.6401.

So, during its regular meeting, the Reserve Bank of New Zealand didn’t change the key interest rate and left it at 1.0%. However, market players expected it to be cut by 25 basis points, down to 0.75%.

The fact that the country’s Central Bank decided not to cut the rate is quite surprising, at least: the regulator was expected to follow the path of other Central Banks and loosen its monetary policy to support the global trend. However, it seems like the situation in the New Zealand economy allows to stay away from global tendencies and follow events in the world closely. At the same time, it’s quite obvious that lower interest rates might help the country somehow because New Zealand couldn’t escape global trade wars.

Last time the RBNZ cut its key rate was in August, by 50 basis points. Probably, it was a preventive measure by the regulator, which now helps to avoid any abrupt movements.

Keeping the key rate unchanged turned out to be a very pleasant surprise for the New Zealand currency.

Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

The Euro reached stability on Friday. Overview for 15.11.2019

At the end of this trading week, the major currency pair slowed down its decline and started consolidating.

EURUSD stopped falling, but for how long? The current quote for the instrument is 1.1019.

The second estimate of the Euro Area’s GDP showed no changes, +0.2% q/q, the same as before. But the statistics from the USA were more optimistic: the PPI added 0.4% m/m in October after losing 0.3% m/m the month before and against the expected reading of +0.3% m/m. The Core PPI showed +0.3% m/m after being -0.3% m/m in September.

The US Federal Reserve Chairman Jerome Powell, who spoke yesterday, said that uncertainty with import tariffs was paralyzing activities of American companies. Due to this, investment issue also remains unsettled and that’s not good for the economy. Powell also noticed that the American national debt was growing faster than the country’s economic system and that’s not acceptable. Sooner or later, the “ballooning” national debt will make the USA put its budget into order, but not right now.

The labor market was defined by Powell as stable. He mentioned that there was a pretty high demand in the sector by historical standards.

In the evening, the USA will publish an interesting report on the Retail Sales in October. The indicator is expected to add 0.1% m/m after losing 0.3% m/m in September, but the actual reading may be even better. It would be good for the USD.   

Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

The Australian Dollar is under pressure again. Overview for 19.11.2019

AUDUSD is falling on Tuesday morning; the pair remains under bearish pressure.

The Australian Dollar is retreating against the USD on Tuesday. The current quote for the instrument is 0.6799.

In the morning, the Reserve Bank of Australia published its latest Monetary Policy Meeting Minutes, which couldn’t surprise anybody: the regulator continued following the labor market and assessing external background, which was suffering from global wars.

At the same time, it’s obvious that major business processes in Australia are slowing down: market players’ attention is completely focused on the trade talks between the US and Chinese officials, who just have no luck signing the first phase of the trade agreement.

Yesterday, China cut the repo rate for the first time since 2015. This is how the People's Bank of China is giving a boost to the country’s economy and financial system. This news can be perceived as China’s readiness for lengthy negotiations and that’s not a good signal for all risk-related currencies.

Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.