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  • Euro under pressure again. Overview for 09.04.2021


    EURUSD is again depressed after a phase of growth earlier. The current quotation is 1.1900.

    The cautiousness in the market might be provoked by the comments of the head of the European Central bank Christine Lagarde. Yesterday she noted that the risks of a slow-down in the European economy are beyond the short-term horizon. However, she considers long-term risks to be decreasing, which means the growth will soon speed up. As before, the pandemic is supposed to be the main risk.

    As for the economy stimulation program, the head of the ECB concluded that it might not be necessary to spend the whole sum – which is 1.85 trillion EUR. However, the Central bank is authorized to enlarge this sum if capital markets need it.

    Yesterday, statistics from the USA was not the brightest: for example, the number of unemployment claims grew to 744 thousands against 728 thousands a week before. Meanwhile, a decline to 682 thousand had been forecast.

    This trading day might be rather calm, especially if statistics turn out favorable. Germany has already issued industrial production data for February, and the index had dropped by 1.6% m/m after the previous slump by 2% m/m. The forecast expected growth by 1.6% m/m. In the evening, the US will present the PPI and wholesale stocks information.

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

    Comment


    • The Euro is waiting for news. Overview for 12.04.2021


      Early in another April week, EURUSD is a little bit retreating; investors are waiting for new catalysts.

      The major currency pair is falling a bit on Monday afternoon. The current quote for the instrument is 1.1887.

      Earlier, Germany reported on its Industrial Production for February. The indicator dropped by 1.6% m/m after losing 2.0% m/m the month before and against the expected reading of +1.6% m/m. Investors are frightened by weak reports from Germany because it might lead t much more serious problems in the key European economy. Germany has always been an economic engine of the Euro Area and it’s rather unclear who may replace it.

      Last Friday, the USA reported on the Core PPI, which added 0.7% m/m in March after expanding by 0.2% m/m in the previous month and against the same expected reading. The Wholesale Inventories added 0.6% m/m against the expected reading of +0.5% m/m.

      The USD is somehow supported by the US bond yield growth. The Euro, in its turn, is looking weaker because market players can’t be sure about the European economy and its ability to quickly recover after the coronavirus pandemic. Lockdowns are still in effect in some European countries and it’s not too optimistic.

      Later today, the Euro Area is scheduled to report on the Retail Sales for February and it might be interesting: the indicator is expected to show +1.3% m/m after being -5.9% m/m in January. The stronger the reading, the better for the Euro. Also, the USA will publish the Federal Budget Balance but it won’t have any influence on the market volatility. At the same time, Fed Chair Powell is going to speak and this is what may attract market players’ attention.

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

      Comment


      • The Australian Dollar is looking down. Overview for 13.04.2021


        AUDUSD is falling on Tuesday; investors are clearly ready to intensify this decline.

        The Australian Dollar is retreating against the USD on Tuesday morning. In general, the Aussie is saving strengths and looking as if it is ready to plummet as soon as there are reasons for that. The current quote for the instrument is 0.7619.

        The NAB Business Confidence showed 15 points in March after being 18 points (a revised reading) the month before. The Business Conditions rose by 8 points to a record high of 25 points, the best over the last 17 months. At the same time, the employment index went from 9 to 16 points. According to the comments from NAB, there is momentum to increase the number of jobs and investments.

        The Australian labor market will be discussed later this week. On Thursday, Australia is scheduled to report on employment. The Unemployment Rate is expected to go from 5.8% in February to 5.7% in March. The Employment Change might show 35K and if so, March may become the sixth straight month of the indicator improvement. It might be interesting to dig deeper in the report and find out the difference between full-time and part-time employment as it may help to understand how fast Australia will create enough jobs.

        Improvement of employment and labor market conditions will describe the recovery process in the Australian economy. However, even in this case, one shouldn’t expect the Australian regulator to revise its monetary policy: the benchmark rate will probably remain low.

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

        Comment


        • The Euro rose to its four-week highs. Overview for 14.04.2021


          EURUSD rose significantly and intends to keep its positive momentum.

          The major currency pair rose pretty much last night and hopes to continue this tendency. the current quote for the instrument is 1.1964.

          The statistics published by the USA last night indicated a boost in the CPI in March. Investors got nervous on expectations that inflation might be rather moderate thus allowing the Fed to avoid revising the benchmark rate.

          The CPI showed 0.6% m/m in March and that’s the biggest MoM reading since the summer of 2012. The Core CPI showed 0.3% m/m. Market expectations for indicators were 0.5% m/m and 0.2% m/m respectively, which are both better than February readings.

          On YoY, US inflation showed 2.6% in March with the Fed’s target level being at 2%.

          These readings may probably indicate that the Fed will keep its monetary policy intact for a long time. It is not beyond the reach of reason to suggest that inflation will keep boosting in the coming months amid the stimulus packages and strong support to the country’s economy. This put pressure on the “greenback” and helped the Euro to recover.

          Right now, the market attention is switching to the US Retail Sales report scheduled for Thursday.

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

          Comment


          • The Australian Dollar stopped growing. Overview for 15.04.2021


            AUDUSD stopped growing on Thursday after rallying the day before.

            The Australian Dollar stopped its rally against the USD. The current quote for the instrument is 0.7727.

            The statistics published in the morning showed that the employment sector is slowly improving. The Unemployment Rate decreased from 5.8% in February to 5.6% in March and that’s better than expected. The Employment Change showed 70.7K in March after being 88.7K the month before and against the expected reading of 35.2K.

            Actually, the current unemployment in Australia is only 0.4% higher than the pre-covid value, which is excellent.

            The Participation Rate in the Australian economy is 66.3%, which is quite close to its all-time high.

            The job number recovery is rather irregular due to higher activity in Queensland and lower in New South Wales and Victoria. However, it’s quite normal.

            The numbers published today are pretty positive for the Aussie. Another thing that supports the Australian currency right now is a local weakness of the “greenback”.

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

            Comment


            • The Euro is correcting after updating its monthly highs. Overview for 16.04.2021


              EURUSD is falling after reaching its monthly highs.

              The major currency pair is expectedly correcting after rallying earlier. The current quote for the instrument is 1.1960.

              The statistics published by the USA turned out to be rather mixed but still positive. For example, the Retail Sales skyrocketed by 9.8% m/m in March after losing 2.7% m/m in the previous month and against the expected growth by 5.8% m/m. However, this was expected as a lot of people got some financial support from the government, and this money returned to the economy right away. in addition to that, weather conditions became more stable, thus making consumers more mobile. The Core Retail Sales showed 8.4% m/m after being -2/5% m/m over the same period of time. The indicator was expected to add 5.1% m/m.

              The Industrial Production in the USA added 1.4% m/m in March after losing 2.2% m/m the month before and against the expected reading of 2.7% m/m. However, no matter how weak the reading is, it’s still the highest over the last 8 months. After the cold weather in February when a lot of manufacturers reduced their activities, everything is going back to normal. The Capacity Utilization Rate in March was 74.4% after being 73.8% in the previous month.

              The weekly report on the Unemployment Claims showed 576K after being 769K the week before and against the expected reading of 703K.

              Many experts have already said that the labor market data might not be objective.

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

              Comment


              • The Euro intends to grow. Overview for 19.04.2021


                Early in another April week, EURUSD is keeping its positive momentum.

                The major currency pair intends to continue growing. The current quote for the instrument is 1.1980.

                The “greenback” remains under pressure after the US bonds yield dropped. At the same time, strong numbers on the Retail Sales in the USA published last week couldn’t become a long-term support factor for the American currency.

                This week of April won’t offer many statistics from the USA. However, one should pay attention to the Existing Home Sales, the New Home Sales, and the CB Leading Index for March. Also, the country is scheduled to publish preliminary reports on the Manufacturing and Services PMIs for April from Markit.

                There might be some interesting news from the Euro Area. The European Central Bank is going to have a meeting and may make a rate decision. The rate isn’t expected to change but the comments from the ECB Governor Christine Lagarde might be quite interesting. She may be quite optimistic in her opinion on the anti-coronavirus vaccination campaign – it means that the region’s economy is ready for its steady recovery rate after the pandemic.

                In addition to that, the Euro Area is also scheduled to report on the Manufacturing and Services PMIs for April. The same reports will be published by Germany – these numbers trigger quite sensitive reactions from market players.

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

                Comment


                • The Yen strengthened to its six-week highs. Overview for 20.04.2021


                  USDJPY continues falling on Tuesday; the Yen is clearly intending to update its local lows.

                  The Japanese Yen continues strengthening against the USD. The current quote for the instrument is 108.42.

                  The US treasury yield is still rather low and that’s a pressure factor for the “greenback”, which makes t fall against the Yen and many other currencies. It seems like the previous rally of the American currency is in the past and market players are quickly coming back to reality.

                  The statistics published by Japan earlier showed that the Industrial Production in the country lost 1.3% m/m in February against the expected decline of 2.1% m/m. The industries that mainly contributed to the decline were motor vehicles (-5.8%), electrical machinery, and information and communication electronics equipment (-2.0%), transport equipment (-3.3%), petroleum and coal products (-4.8%), food and tobacco (-2.5%), and pulp, paper, and paper products (-2.5%).

                  On YoY, the indicator lost 2.0% against the expected reading of -2.6%

                  The Tertiary Industry Index added 0.3% m/m in January after losing 1.0% m/m in December and against the expected reading of +0.6% m/m, which means that some businesses started reviving as in winter due to the first weeks of the anti-coronavirus vaccination campaign.

                  The next important March reports from Japan will be released on Friday, such as the Manufacturing PMI, which is expected to improve, and the National Core CPI.

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

                  Comment


                  • The British Pound retreated from the high. Overview for 21.04.2021


                    After updating its March highs, GBPUSD is retreating and waiting for the news.

                    The British Pound is correcting against the USD on Wednesday. The current quote for the instrument is 1.3931.

                    The data published yesterday showed a significant improvement in the employment sector. for example, the Unemployment Rate went from 5.0% in January to 4.9% in February although it wasn’t expected to change. The Participation Rate decreased a little bit and was 75.1%.

                    The Claimant Count Change was 10.1K in March after being 67.3K the month before and against the expected reading of 24.5K.

                    The Average Earnings Index showed 4.5% 3m/y after being 4.8% 3m/y in the previous period and against the expected reading of 4.7% 3m/y. The indicator is still affected by low-paid job cuts for optimization in the midst of the coronavirus pandemic. The sector is supported by a state program that implies guaranteed increased unemployment payments, which is set to operate until the end of September 2021.

                    The statistics are quite positive given the fact that the United Kingdom is still locked down.

                    Later today, the United Kingdom will continue publishing macroeconomic statistics, such as the Consumer Price Index, which may show 0.8% y/y in March after being 0.4% y/y in February. In addition to that, there will be other reports on prices, for example, the PPI Input and Output, the Core CPI, the RPI, and the HPI.

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

                    Comment


                    • EURUSD started consolidating. Overview for 22.04.2021


                      EURUSD is consolidating after updating its local highs.

                      The major currency is not too active on Thursday. The current quote for the instrument is 1.2029.

                      The USD got some support after investors revived their interest in “safe haven” assets following the news about the increasing numbers of new coronavirus cases in India and Japan. In addition to that, the Bank of Canada signaled its decision to increase its rates in 2022, which also make market players worry.

                      Later today, the European Central Bank is scheduled to have another meeting, which is widely expected by the financial world. It’s very important to hear what ECB Governor Christine Lagarde has to say. Interest rates are highly likely to remain intact.

                      Also, investors are starting to prepare for the US Fed meeting scheduled for the next week, although none of its monetary policy aspects are expected to change.

                      In the evening, the Euro Area is planning to report on the Consumer Confidence, which may remain unchanged at -11 points in April.

                      Moreover, the USA will report on the Existing Home Sales, which may show 6.18M in March after being 6.22M in the previous month. Another report to be published is the CB Leading Index for March, which may add 1.0% m/m.

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

                      Comment


                      • EURUSD is back to growing. Overview for 23.04.2021


                        After falling for a while yesterday, EURUSD is back to growing.

                        The major currency pair resumed moving upwards after a short pause yesterday. The current quote for the instrument is 1.2035.

                        The after its April meeting that was over yesterday, the European Central Bank didn’t change any aspects of its monetary policy. In the comments that followed, Governor Christine Lagarde said that the short-term economic outlook remained rather cloudy due to uncertainty in the region, as well as the risks for more significant financing terms. According to the ECB, the inflation boost that could be seen recently happened due to some specific factors but the overall situation with the inflation pressure remained rather low.

                        The regulator is sure that the PEPP program will be carried out faster this quarter than before. However, the ECB is not planning to carry out the program to the full extent but it may yet happen if necessary.

                        The ECB believes that the European economy may shrink a bit in the first quarter but is expected to improve in the second one.

                        Mid-term risks are estimated by the regulator as more or less balanced, while the overall inflation pressure is expected to increase in the coming months.

                        At first, the Euro fell after these comments but managed to quickly recover a bit later.

                        Today, one should pay attention to the statistics on the Manufacturing and Services PMIs from Germany, The Euro Area, and the USA.

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

                        Comment


                        • nice analysis

                          Comment


                          • The Euro is sticking to its seven-week highs. Overview for 26.04.2021


                            EURUSD is correcting a little bit but still remains quite strong.

                            Despite a slight correction, the major currency pair is looking pretty confident on the final Monday Đ·Đ° April. The current quote for the instrument is 1.2107.

                            The most important thing right now is the attitude of global investors to risks – this is the factor that drives the Euro upwards. Nevertheless, the current market conditions are rather neutral for the USD: the US 10-year bond yield is above average and the numbers coming from the USA are quite good.

                            The statistics published by the Euro Area earlier demonstrated the increasing business activity in the region. For example, the Services PMI increased up to 50.3 points in April after being 49.6 points the month before. The Manufacturing PMI showed 63.3 points against 62.5 points over the same period of time. on the other hand, Germany didn’t impress: the same indicators showed 50.1 and 66.4 points in April after being 51.5 and 66.6 points respectively in the previous month.

                            The USA published quite strong readings. For example, the New Home Sales showed 1,021K in March after being 846K the month before. It seems like the real estate market completely recovered after a winter slump caused by the storm season and extremely cold weather.

                            The Manufacturing PMI from Markit improved up to 60.6 points in April after being 59.1 points in the previous month. The Services PMI also went up, from 60.4 to 63.1 points over the same period. Manufacturers are getting more active, which is good, but they still notice some difficulties with access to raw materials due to more active domestic demand.

                            Later today, market players should pay attention to a rather volatile report, the Durable Goods Orders, which is expected to show 2.5% m/m in March after being -1.2% m/m in February.

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

                            Comment


                            • The Yen is losing to the USD. Overview for 27.04.2021


                              USDJPY is rising on Tuesday after the BoJ meeting.

                              The Japanese Yen reversed and is falling against the USD on Tuesday morning. The current quote for the instrument is 108.22.

                              The April meeting of the Bank of Japan was over in the morning and all key parameters of the regulator’s monetary policy remained intact. The benchmark rate has been -0.1% since January 2016. In the comments, the BoJ said that it was going to continue targeting the 10-year Japanese government bond yield at around 0%. In addition to that, policymakers will continue purchasing government bonds without any limitations.

                              Also, the Bank will purchase CP and corporate bonds with an upper limit on the amount outstanding of about 20 trillion yen in total until the end of September 2021.

                              Overall, the total annual volume of bonds to be bought by the regulator is about 12 trillion yen.

                              In other words, the regulator continues monitoring the situation and doesn’t change anything in its monetary policy, although it should admit that the time for that came a long time ago.

                              Among other interesting things is the BoJ’s revision of some aspects of its economic outlook. For example, the GDP growth for 2021 and 2022 went from 3.9% and 1.8% to 4.0% and 2.4% respectively. the Core CPI is expected to be 0.1% against the previous estimate of 0.5%. In 2022 and 2023, it might show 0.8% and 1.0% respectively.

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

                              Comment


                              • The Euro is keeping an eye on the situation. Overview for 28.04.2021


                                EURUSD is slightly falling and waiting for news from the Fed.

                                The major currency pair is slowly falling on Wednesday. Investors are saving strengths in anticipation of the Fed meeting results. The current quote for the instrument is 1.2070.

                                The statistics published yesterday showed that the HPI in the USA added 0.9% m/m in February against the expected reading of 1.0% m/m.

                                It’s quite interesting that the S&P/CS Composite-20 HPI, which covers the 20 biggest cities in the USA, skyrocketed by 11.9% y/y and that’s the highest reading over 15 years. Americans are obviously striving to buy new houses and real estate prices skyrocketed in the midst of low demand.

                                Significant improvement of the Consumer Confidence from Conference Board was also a pleasant surprise: it went from 109 points in March to 121.7 points in April, although market expectations implied 113.1 points, the current reading is the highest in the last 14 months. It seems like the population is becoming more optimistic when it comes to their incomes and savings. One of the reasons for that is the labor market improvement.

                                The Current Conditions reached this year’s high at 139.6 points, while the Economic Expectations rose to 109.8 points, which is also quite good.

                                The key highlight for today is the completion of the Fed meeting, so investors will focus their attention on it.

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

                                Comment

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