EUR/USD
draghi's press-conference sent the euro much above 1.38. The single currency is now trading at 1.3850. Excluding a short-term upsurge of the pair in December, the pair was that high only in November 2011. Technically, growth of the pair isn't likely to face any serious resistance right up to 1.4250. The spring triggered and pushed the pair up by over a figure in a couple of hours. It should be mentioned that the upsurge began 45 minutes before the press-conference, which means that the markets presupposed a possibility of the rate cut or measures to increase liquidity in the region. It could also be sensed in the questions of journalists, who more than once asked the ECB president about a possibility of the rate cut in the coming months. To this Draghi answered with enumeration of positive shifts in the economy, yet mentioning that he was ready to act if needed. The report on weekly unemployment claims remained in the shadow of the press-conference. The decline to the three-month lows gives hope for stronger unemployment statistics today. Though ADP's data, corrected for a stronger correlation with the official statistics, showed the scanty 139K, we still hope to see the rates at about 160-180 today, which is above the average market forecast (150). In the meantime, such data will hardly help the dollar grow to the levels, from which it started its depreciation against the euro yesterday. The ECB isn't tempering the policy and will hardly do that, if the economic growth will meet the forecasted rate of 1.2% this year. The ECB's balance is shrinking since other banks are returning money, while the Fed (despite the tapering) is still extending its balance. The expensive euro is posing a threat to the eurozone, but here we should understand that for the regional officials to start taking some measures the rate should deviate a lot. On balance, we believe that even a strong report today won't be able to push the euro/dollar below 1.38.
GBP/USD
The sterling kept a low profile yesterday since there weren't any messages about changes in the policy or comments from the BOE. It was an expected thing, so the pound was reluctant to follow the euro in its growth against the dollar. But even that was enough to raise the pound to 1.6770 for a while, which was last seen three weeks ago and before that – over four years ago. Here the risk is posed by a strong correlation with stock indices, which have climbed quite high recently, thus increasing the risk of correction.
USD/CAD
The Canadian dollar remains in the limelight due to abundance of news releases regarding it. As was mentioned yesterday, the commentary on the monetary policy was focused on positive moments; a month ago there was an optimistic employment report (full-time employment grew by 50.5K). The February peak in usdcad was lower than that of January, which suggests reduction of the bullish pressure. Today's reaction of the market to the US and Canadian employment statistics will be of great importance. If this week the pair manages to remain below 1.10, it will strengthen bears' claims.
USD/JPY
The pair has been growing with confidence this week, slowing down only yesterday at 103 due to the general capital outflow from the dollar. It's remarkable that even messages about the intention of the Crimean parliament supported by Moscow, which caused some impulse in demand for safety, failed to change the situation much. Instead of a pullback or a reversal, we've seen a mere consolidation.
