GBP is the only one to resist USD

By GG Analyst in Reviews 0 Comment

EUR/USD

The comments, preceding yesterday’s speech of Yellen, often contained hints at the possible beginning of an uptrend in USD. Actually, Yellen’s speech was of the same mood as the previous comments, that is rather dovish and cautious. Anyway, market participants got what they wanted – the dollar started its ascent. Addressing the Congress yesterday, Yellen drew attention to the persisting high rate of unemployment and the need for the stimulating monetary policy. In our opinion, these words clearly unveil the fear to allow sharp and quick toughening of the monetary policy and repeat the mistake, made by the Fed in the more…

Profit taking in GBP

By GG Analyst in Reviews 0 Comment

EUR/USD

Monday didn’t abound in important news releases and statistics. Anyway, the single currency managed to slightly grow against the dollar and the pound. At the very beginning of trading in Europe EURUSD rose by 40 pips due to the stronger risk demand, which we highlighted in our yesterday’s review. However, by the end of the day the positive had dispersed. To some extent it was a result of Draghi’s claims in the EU Parliament that purchases of public and private debt fall ‘squarely’ within the ECB’s mandate. Many officials in Germany and other core countries, including members of the ECB, are more…

VIX lows, GBP highs

By GG Analyst in Reviews 0 Comment

EUR/USD

The dollar was getting weaker all through the EU session yesterday. Only at 1.3640 bulls eased their pressure, taking their profits. The same situation was observed in the stock exchanges. Now the euro/dollar is trading at 1.36, thus promising a good week for bulls. They will hardly yield here without trying to attack the 200-day MA. All this depreciation of the dollar leads to decline in the VIX volatility index. Earlier we thought that the very approach of the index to its lows would be more than enough and the market wouldn’t go further, since we expected that volatility would grow more…

FOMC’s caution puts pressure on USD

By GG Analyst in Reviews 0 Comment

EUR/USD

The mild Yellen has remained her own self. Against our expectations that FOMC would learn a lesson from the financial crisis and would choose another policy for the Fed, it treated the macroeconomic forecasts with great caution after the poor beginning of the year. The long-term GDP forecasts were slightly revised down. Though at the same time the spread between the rates increased, thus reflecting a more hawkish mood than earlier. The markets preferred not to focus on the last moment, seeing only caution regarding the future measures. The markets got quiet about the possible acceleration of tapering and approach of more…

Why the Fed should by tougher

By GG Analyst in Reviews 0 Comment

EUR/USD

The US inflation stats came as an unpleasant surprise for the dollar-bears yesterday. It turned out that consumer prices in May grew by 0.4%, which is twice as much as expected. The annual inflation instead of staying at 2.0% grew to 2.1%. Of course, it is too early to speak about the radical change of the situation, however now the Fed surely has less space for maneuver. In accordance with the classic economic rules, increased consumer activity has led to faster price growth. Apparently, in the coming months we’ll see much of this. The seven meager years after the subprime mortgage more…