The silence of G20 enables JPY to depreciate

By GG Analyst in Reviews 0 Comment

EUR/USD

Last weekend there was held a meeting of G20 central bank governors and finance ministers. The representatives of the largest countries, constituting about 85% of the global economy, focused on stimulation of economic growth. Nothing was said about currency movements. Thus, the current rally of the dollar received a tacit approval, so the bulls may gain the lead, at least for a while. Now USDX is trading near its two-year highs. Then growth of the dollar was explained by weakness of the single currency. And now it is USD’s rally, aroused by expectations of the monetary policy tightening and of impressive more…

Scotland supported Britain and helped the markets

By GG Analyst in Reviews 0 Comment

EUR/USD

All day long yesterday the single currency was taking painful attempts to recover after the mess made by FOMC’s intention to introduce a tougher monetary policy than expected. It also must have been to the advantage of the single currency that the demand at the TLTRO auction , which the ECG conducted for the first time, proved to be lower than forecasted. The analysts, surveyed by Bloomberg, expected bids for approximately €175bln, while the actual demand proved to be twice as low, making 82.6bln. It means that banks don’t hurry to make 4-year loans at quite a low interest rate of more…

FOMC intends to act with decision

By GG Analyst in Reviews 0 Comment

EUR/USD

The Fed is preparing the markets for a more dramatic increase of interest rates from the beginning of toughening. Besides, Fed Chair, despite all vagueness of her comments, made it clear that the markets were underestimating closeness of rate increases. It can be treated as a promise of the first increase already in the first 3-4 months of the next year instead of the middle of the year as expected earlier. It seems that Janet Yellen tried to imitate Greenspan, making obscure comments and leaving herself more space for maneuver. If she starts to imitate not only Greenspan’s manner of wording, more…

Profit-squeeze in USD

By GG Analyst in Reviews 0 Comment

EUR/USD

China has pleased the markets a bit, announcing allocation of funds to five largest banks of the country. $81bln is not a very big sum and bears no comparison to the two preceding programs of incentives. However, the market more and more expects that the National Bank of China will remain on the sidelines at the time of sharp economic slowdown. ZEW Economic Sentiment proved to be stronger than expected and that aroused some optimism regarding the euro. The main index fell from 8.6 down to 6.9 instead of the forecasted reduction to 5.2. The indicator of the current situation tumbled more…

The Fed needs to be more cautious

By GG Analyst in Reviews 0 Comment

EUR/USD

Yesterday the single currency fell under pressure and dropped below the support line of the short-term uptrend. Yet, in the afternoon it found support near the lows of the preceding day due to the poor stats from the USA, which saved the pair from further selling. The EU trade balance statistics proved to be contradictory. The seasonally adjusted surplus fell short of the expectations, making €12.2bln against the forecasted 15.9 and the preceding value of 13.8bln. But for all that, the non-seasonally adjusted value of the indicator reached the impressive 21.2bln against the expected 10.5 and the preceding value of 16.7. more…