EUR/usd

The euro is losing ground. The tiny brook of the ECB's liquidity is quietly doing what it should. During the initial reaction to the ECB's news last week there were enough euro-buyers not only to take the pair back, but even to try to get above the 200-day MA (1.3644 at that moment). Anyway, Friday and this week will dot the i's and cross the t's. Even skeptics, asserting that the ECB's measures have a very small effect, have to admit that in contrast to the trend for toughening in the CBs of other developed countries the European policy looks more and more mild. It gives cause for selling in the euro. Traders, surely, are now trying to fit the euro into the role of a funding currency. And it entails decline of EUR/USD at the moments favourable for the stock markets. We can't but notice the scale of growth, showing in the stock markets since last Thursday and at the same time simultaneous decline of the pair. Yesterday it was pushed down to 1.3532 and this morning it has fallen to 1.3520. There won't be any important news from Europe and the USA today, so it is not worth expecting a fresh low. And at the end of the week it can happen on the release of the US retail sales data (on Thursday). Should the US stats be strong, the level of 1.3500 may be at stake. Further the bulls' resistance can be entirely broken. The obstacle here can be posed by China's desire to diversify its funds away from the dollar. Though it is unlikely that they will be too zealous at these levels, when the entire financial world makes opposite transactions, borrowing the euro. Anyway, the considerable trade surplus supplies China with cash inflow, which mainly sinks in the CB reserves.

GBP/USD

The British industrial production is again quite strong. In April the indicator grew by 0.4% (in line with the forecast) and against last year's rate it rose by 3.0% in comparison with 2.5% a month before. The data were also revised down, which helped the sterling. In a few hours NIESR published its GDP estimate for three months up to May, reporting growth by 0.9%. It means slowdown from 1.1 for three months up to April, but is still very impressive. 

USD/JPY

Despite the progress of the markets, the yen is still in quite a good demand. USD/JPY remains close to 102.30, as a day before. Probably, hitting of 102.20 will arouse demand for the pair, as it was on June 6 and 10, but still for a full-scale uptrend there should be some action from the BOJ, which holds a meeting on Friday. However, it could be a surprise as the country's CB is not expected to take any action. 

NZD/USD

It is expected that the RBNZ will raise the rate tonight, but will make it clear that it is not going to hurry with the further increases. The Kiwi was under pressure for a month and fell from 0.8780 to 0.8400, but since last week has recouped almost 40% of that decline. As you remember, the RBNZ has frequently mentioned that it is displeased with the high rate of the national currency and it will hardly favour that the Kiwi hasn't weakened much over that time. Anyway, isn't it the Bank to blame for it?