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AUD

Upturn of price for primary goods and strengthening of investors\' risk inclination promoted the Australian dollar growth on Tuesday. The increase of AUD/USD currency pair stopped slightly higher than 0,8220, that was already seen twice in June. Till the opening of current session the pair stopped above this level and sharply lowered to 0,8160. However, the economic climate is positive for further advancing of aussie, as the Reserve Bank of Australia is to severe the monetary policy, although, it is unlikely to raise the key rates before the next year beginning.
In a mid-term, AUD/USD also has growth potential to reach new highs this year. This is encouraged by the Chinese currency reserves increase in Q2, which must be invested, and risk inclination strengthening due to some factors, which are promting the primary currencies purchase and low-profitable currencies sales.
Nevertheless, amid the recent pair\'s growth the pair may face with the technical resistance. In a short-term, the Australian currency direction will be set up by the stock markets and reports on the American companies\' profit, as the fianacials release is still the key factor for the investors\' attitude to risk, besides, there will be no news next week.

JPY

USD/JPY rose due to Stop orders around 93,80, brought to action with the purchases by the Japanese importers. The yen was also badly influenced by concerns about Toshin bonds dilution on Friday. These bonds are issued as a foreign currency for the Japanese buyers, its issuance approves the demand tick up on foreign assets from the Japanese investors.
Dollar and Euro can get a push to gain against the yen, if during the next sessions the trust funds of Japan invest their money in foreign assets, denominated to these currencies. Earlier, the funds informed their clients that they will buy the foreign assets this week. It can help to bring the USD/JPY pair above 95,00 in the next few sessions.
At the same time, an increase above the key resistance 95 during the current trading day will be hindered because of huge volume of sales orders, set up at this level. In order that dollar rises above 95 versus the yen, a couple of positive factors for the greenback are required.
On the other hand, the USD/JPY pair may fall to 91,00 in near weeks. More and more investors suppose that the global economy recovery may take more time. Institutional investors seem to reduce the losses, selling the USD/JPY currency pair, bought at higher levels than now, as they are worrying regarding the global economy perspectives. Apart from this, if there emerge negative news concerning the U.S. economy, probably, the investors would apply to yen, as to the asylum-currency. Hereafter, some market participants are doubting that the interest to risky assets will remain. The risk inclination may lower if the profit reports of the major American companies, which are expected later this day, come in weaker than it was estimated. Amid this, there are some concerns regarding CIT liquidity problem.
One more important day\'s event turned out to be the interview with the high-ranking representative of the Japanese oppositional Democratic Party Naoki Minezaki saying that it is better to avoid the intervention in the currency market in order to restrain the yen\'s rally, because the stronger currency may appear to be a good factor for the economy if this growth isn\'t too sharp. Minezaki also consideres that the Bank of Japan should raise the interest rates from the current level of 0,1% after economy rebounds. The interest rate upturn can stimulate the household expenditure increase due to the profit growth from the interest for the Japanese consumers, having a lot of savings. It can help to make the internal demand more essential driving force for Japan\'s economy. His comments were announced in the period when the market players are trying to understand how the Democratic Party of Japan will carry out the economic policy if, as expected, it is to win the national elections scheduled for August 30. According to Minezaki explanations, if the yen rallies the trade conditions will improve, because the goods imported from other countries will be cheaper. One more advantage of strong yen is that it can make adjustments in the Japanese manufacturing sector, promting the exporters to work harder to survive, and make weak companies leave the market. Minezaki sounded a note of warning regarding that the Finance Ministry of Japan keeps a big part of its reserves in dollar, amounting to 1 trln.dollars. One of the ideas is to modify a part of Japan\'s assets into euro-denominated bonds. This measure can decrease demand on dollar-denominated assets, that will lead to the dollar\'s weakening.

NZD

The New Zealand dollar rose to 9-month high on Thursday, after the traders had ignored the warning of New Zealand Treasury Secretary Bill English about that the national currency\'s rally threatens the economic revival. As it is supposed, the recession in the country finished in Q4. The pair ticked up by 35% from its low, reached on March 08.
Although, there were no any significant consequences after severe announcements of New Zealand authorities, including the Head of NZ Reserve Bank Bollard last week. The kiwi strengthens due to the U.S.dollar easing, growth of investors\' risk inclination and sentiments about that the NZ Reserve Bank had stopped the monetary policy lightening.

USD

Prior to the European deals opening the American currency fell, despite more moderate stock indexes dynamics, which was to ease the investors\' risk inclination and support the U.S.dollar. Partly, this weakness is caused by the emerged information in press concerning that the Central bank of Peru reduces dollar\'s share in its currency reserves from 82% to 62%. The total currency reserves volume of Peru amounts to about 30 bln.dollars. Nevertheless, the greenback remains in the recent diapazon against majors, and only a break through of 1,4300 is able to bring into action the EUR/USD movement. For Thursday was not scheduled a big data volume, so all attention will be compeled to shares.
The U.S.dollar was harmed because of the risk inclination increase due to the house prices upturn in the USA and an optimistic mood ragarding the Q2 financials of the companies after E-bay reported a high profit rate. Though, the market climate did not improve substantially with low-key adjustments. The general risk inclination remains at the highest levels in the period before the last year Q3 beginning and high-profitable currencies moved closer to crutial resistance levels.
Worth noticing that Asian State Investment Fund was actively buying the U.S.dollar during this session against the Swiss franc, Euro, Canadian dollar and British pound. And it happened for some reason.
Within the American trades dollar gained significantly, as the risk inclination in the currency market began decreasing. The bulls decided to take their time passing the baton to the bears.

GBP

Known for its volatility the Great Britain retail sales report enhanced its support of the British pound. Pound rose after the data showed that British retail sales rose unexpectedly in June 1,2%, compared to the previous month, when it was predicted the sales growth by 0,3%. The GBP/USD gained by 40 points and reached the day maximum at 1,6541.
But the rates tick up was restrained on the European grounds, and the main European stock indexes were fluctuating between positive and negative zones, that led to the investors\' risk inclination lowering, that took its rise at the beginning of the European session, and there had emerged the first signs of the GDP/USD sharp rally, which took place further.

EUR

Euro lost some positions taken before the American session start-up against the U.S.currency amid a slide down of futures rate for S&P index, and also due to down-going pressure owing to the market\'s respond to the American currency surge versus the Swiss franc. However, the EUR/USD jumped up in consequence of release of the U.S. jobless claims report, higher than the experts forecasts. Apart from this, it is stimulated by the investors\' risk inclination increase due to rising signs of economic recovery, which are shown in the profit reports of companies for Q2. The EUR/USD upward movement accelerated amid the crude oil price upsurge.
Nonetheless, such confident dynamics is considered as a sale opportunity, that happened to be later.

Worth pointing out that the EUR/CHF pair touched the week maximum at 1,5210, as it is bought by one of the main American banks and British Clearing bank.

CAD

The USD/CAD was trading with moderate lowering amid low-key trading activity prior to the last quaterly report issue on monetary policy from the Bank of Canada. The market participants were looking forward the monetary policy report to evaluate the reasons for revising the Bank of Canada forecasts concerning the economic confidence and some comments related to strong loonie\'s influence on possible economic recovery. At the same time, nothing new in the currency market was expected after that the Central bank had reported a smooth sentiment regarding the Canadian currency force after the interest rate decision taken on Tuesday.
The USD/CAD reached a new 7-week maximum at 1,0863 from the beginning of June after was announced the Bank of Canada sentiment. The Central bank announced that risk of steady fall in the global economy decreased significantly and the global economy is to reach the bottom.


Kind regards,

Analyst: Vladimir Donin