EUR/usd

At today's summit the European leaders are to sign an agreement on the establishment of the permanent saving fund and balanced public budgets. However, the Greek issue is still weighing heavily on the summit participants. As news agencies report, no agreement has been reached so far during the negotiations with the private sector. Again we hear about some progress, but with such pace it is really hard to discern. On Monday investors are likely to focus on Europe and that may put certain pressure on the single currency. Moreover, it's also possible that the euro will decline after the two-week growth. Our target level of 1.32 was taken at the end of Friday's trading on the dollar decline which speeded up after the release of Advance GDP data. The U.S. economy grew by 2.8% in the 4th quarter of 2011. It's enviable growth, but for the most part it's been achieved due to the supply build-up. Exports haven't become the momentum of growth, subtracting 0.1% from GDP. Stock markets also haven't managed to go up on such GDP data, marking the correction which was still in place during the Asian session on Monday.

GBP/USD

The British currency continued to go up against the dollar on Friday, breaking the 1.57 level. In December the currency took several attempts to get to this area, which actually proved unsuccessful. If the correction in the stock markets continues, the pound may again behave as in the past, slipping back below 1.55. Taking a broad view to the situation, the unsteadiness of the recovery and readiness of the Bank of England to soften the policy further could put pressure on the pound, which has been moving in the 1.40 – 1.66  range over the last three years. The pair was trading at the top of the range in the middle of the last year, so the decline is quite likely to begin now.

USD/JPY

The Japanese yen demonstrated handsome growth on Friday. As has been described, the USD/JPY rate had climbed too high and failed to consolidate its grip on those levels, but the scale of Friday's yen purchases was really impressive. The pair slipped from 77.45 to 76.70, where it gained support then. The feeling that powerful market forces do not let the pair to fell below this point is getting stronger. The reversal from these levels took place in November, in the first week of January and two weeks ago. Earlier in August USD/JPY held above this mark most of the time. It will be interesting to see if the traditional seasonal repatriation, now complicated by the need to raise more money for the country's recovery, will be stronger than the market forces that do not allow the yen to rise now. It is possible that this force is the bank of japan.

AUD/USD

The Australian dollar got a heavy blow on Monday morning. Despite Friday's antidollar-rally, the aussie didn't managed to go above the previous high. As has already been noted, the currency reversed, stopping one step away from 1.07. The previous powerful rally significantly wearied the bulls, so it's most likely that in the coming days we will observe consolidation or a considerable decrease in the pair.