EUR/usd
Yesterday the single currency continued its impressive descent. Earlier we mentioned that it was walking a tightrope close to 1.33. This morning the pair has fallen to 1.3240, which is the lowest level since last September. The selling impulse strengthened due to the release of fomc's meeting minutes at the end of July. They focused on advantages of earlier rate increase. They consist in the fact that later a smaller rate increase will be needed and it means that there won't be a necessity to cool the economy. The smooth monetary policy is the major priority of the world's CBs. In other words, the CBs are aiming to take as little effort as possible to reach the final goal. The Fed will follow this strategy if it gets support from the employment statistics. Thus, these economic data are again potentially dangerous and able to stir high volatility. In particular, today we will get data on weekly unemployment claims. These statistics haven't been very impressive in the recent few weeks. The number of unemployment claims has been growing since the middle of July, but should the decline resume, the dollar's rally may continue. Especially taking into account that the market has now entered the zone with many stops. Upon the whole, the dollar's rally this week and the preceding movement since the beginning of July haven't reached their extreme points yet, so we cannot seriously think about a correction. The dollar index yet has the potential to grow by 2.5 -3.0 to get to the preceding local lows. So, there can be no pullbacks right up to 1.30-1.31.
GBP/USD
Yesterday the British pound got support from the MPC's meeting minutes. It turned out that two members voted for the rate increase by 25 b.p. Upon the whole, of course, there weren't any risks that the rate would be changed. However, it is a clear hint to the market players that the BOE's intentions should be treated in earnest. The reasoning was similar to that regarding the Fed: earlier increase will help to avoid unwarranted toughening and carry out more even rate increases later.
USD/JPY
The yen's rally has begun and the sharp upsurge in usdjpy since the beginning of this week confirms it. Over this time the pair has risen by a figure from 102.80, besides the four-hour charts show that only two candles have been closed negative this week. Money is coming back into the markets after the summer break and investors are trying to find something with a higher yield than the Japanese yen, especially when the dollar is none the less reliable and the US economy and monetary policy look quite optimistic.
AUD/USD
The aussie is depreciating in view of the growing popularity of the US currency. Besides, the markets remember Stevens' words about possible interventions by the RBA to bring the currency to more reasonable, in the opinion of the Bank, levels. Don't also forget that the RBA's governor warned about underestimation of the dollar's strength by the markets in connection with the beginning of toughening in the USA. Earlier in such periods the dollar index grew from 80 to 120. And this is growth by half.
