EUR/usd
Stock exchanges sighed with relief on the news that Obama and the republican leaders hope to avoid a government default. The recent messages point out that the best thing we can get now is an agreement on a short-term debt ceiling increase to gain time for negotiations. As we saw in the preceding three times, the farther the deadline was the farther the positions of the parties were. Now there are more incentives to look for a compromise to overcome the political crisis. But it is not our case. Thus, the US markets have grown by almost three percents from the lows of Wednesday and returned to the area of last week's highs. Asian stocks grew in price to the three-week highs. In the currency markets it is not all that simple. Here we also can see that the dollar hit a local high on Wednesday evening, but after that bulls still took attempts to change the situation. And up to now there haven't been any signs of animation. Apparently, it is due to absence of American statistics. By the way, today we may get interesting information regarding the US sentiments. University of Michigan will publish its preliminary estimate of consumer sentiment. Actually, the monitored period will hardly include the government shutdown, however even closeness to it is likely to shake confidence of households. In general, it should tell badly on the dollar, but on the other hand, fresher information regarding prevention of a default after October 17 may support the dollar as it implies that the Treasury will be actively releasing debt securities, diminishing the market liquidity. It is all theory, recently we've often seen that Forex doesn't behave as predictably as stock exchanges.
GBP/USD
The sterling is on firm ground now, having pushed off 1.5900 yesterday already before the beginning of the active European session. By now gbpusd has managed to rise to 1.5980 as the BOE failed to put pressure on the British currency. Apparently, the members of the MPC now don't see any need for stimulus increase and are trying to assess how quick the recovery will be. In our opinion, it will be good if the third quarter will show growth of over 0 – 0.2%.
USD/JPY
The yen keeps retracing and during the Asian session (when the exchanges rose to three-week highs at some point) reached 98.50. It's two figures above the weekly lows. Most likely, the markets will want to take a break today, taking the profits. But be cautious bears. If the debt ceiling is raised, the yen will probably continue its depreciating against the US dollar. Our target – reaching of 100 yens per dollar – is still valid.
gold
Gold is disappointing. This precious metal has again slumped below 1300 $/t oz. Actually, it is still moving in the downward channel, which contradicts to the seasonal tendencies. It seems that now investment attractiveness of Gold depends much on bond yields rather than on consumer activity of the developing countries and performance of stock markets.
