EUR/usd
Yesterday traders took advantage of the dollar's weakness to sell the euro at a higher price. As we said, optimism in connection with higher certainty about the political situation in Italy proved to be short-lived. The rate cut expected next week is of much greater importance for the markets. But we shouldn't also forget the factors which may force politicians to take this measure. They are contraction of business and consumer activity and decline of inflation. These factors combined made yesterday's growth of eurusd very unsteady. On the way to 1.31 sellers came into play and for a couple of hours pushed the pair by over a figure down. Later the pair was consolidating close to 1.30 and in the morning again resumed growing but already due to strengthening of the Asian markets. So, again there is a risk that appreciation of the single currency will be unsteady and its performance – determined largely by external factors. Perhaps, the most important one here is the release of the preliminary estimate for the US GDP in 1Q. Yesterday Britain sprang a real surprise as hardly anyone had expected growth. Meanwhile, everyone looks forward to quite favourable data on the US GDP. The average market forecast speaks about the annual growth rate of 3.1%. In terms more common for Europeans we get approximately 0.8% q/q. The preliminary estimate very often differs from expectations, so it's quite possible that the market will be volatile. Here strong data will make contrast with Europe sharper and once again remind that further easing may not follow.
GBP/USD
The sterling was doing perfectly well yesterday. The market positioning was absolutely different from the average forecast of economists. For this very reason the economic growth by 0.3% instead of the expected 0.1% gave rise to the rally in gbpusd by two figures and even now doesn't let the sterling move off the gained positions. It's good that the economic growth is made up of the 0.6% increase in the services sector and some recovery of production after the preceding decrease: growth by 0.2% after the drop by 2.1% at the end of 2012. Britain managed to evade triple recession, however there are no reasons to expect further extension of QE yet.
USD/JPY
Fresh reports on the Japanese consumer inflation once again emphasized the importance of the task set before the BOJ's head Kuroda and Premier Abe. The national index of consumer prices has fallen lower against the previous year, to -0.9% in March. Yet some signs of hope can be noted in the preliminary statistics for Tokyo. April's CPI showed a smaller decline annually, from -1.0% to -0.7%, which is a bit better than expected. Anyway, the bulls here have remained without support. usdjpy again rolled down below 99 and this morning fell as low as 98.20.
oil
A certain change in the US inventory balance revived Oil. Yet, for the most part it is a result of the unrest in Venezuela. The recovery of gold and quite positive statistics from the USA are also the factors which stimulate purchases of the commodity. Thus, a barrel of WTI Crude again costs $93.
