AUD
The AUD/USD pair rose to its maximum since September 2008, while the bonds fell sharply amid optimistic comments of Reserve Bank of Australia Head Glenn Stevens concerning the national economy and its ability to overcome the global financial crisis. According to RBA Governor, it has become more possible that the Australian economy won\'t face one of the most severe recessions since post-war period, there was no distressing jobless rate increase and the confidence has strengthened. RBA signals about risk balance, and the next adjustment will be on the upside. Stevens said there is no such rule prohibitting the central bank to raise the interest rates until the jobless rate touches its peak.
Although the Australian economy still undergoes hardship, there is an evident that large-scale interest rate lowering and fiscal stimulus measures for struggle with the global economic downturn, helped the economy to head over water and kept the confidence high. Apart from this, currently, the private sector analysts had cut the jobless peak forecast, referring to the economic climate improvement and demand growth on such essential export goods as ironstone and coal. In the house funding sector was witnessed a significant demand increase this year, and compared to this indicator abroad, the house prices had up-going trend. The mortgage arrears remained low and even moved down in some cases.
The optimistic comments of RBA Governor Stevens did not bring anything new regarding the monetary policy, but taking into account the currency market fluctuations, the AUD/USD pair will probably test the level of 0,8400 in a short term. The next week will be very important for the Australian dollar, amid the RBA meeting and quaterly forecasts release. Presently, different factors are determing the Australian currency direction, but there is a feeling that currencies are beginning to demonstrate substantial adjustments.
NZD
During the New Zealand session NZD dropped, when the data showed external trade deficit with the contraction of milk production export and plain import. However, the kiwi rallied when in the market were evaluated the trade findings more detailed, which showed growth not taking into account the plain purchase effects.
The deals mostly took place in narrow diapazones, as there were no motivations for significant adjustments and the Asian stock markets showed choppy trading and couldn\'t set up the currency movement. But the Australian Central bank Head comments promoted the NZ dollar rally at the end of the session.
Nevertheless, currenctly, there had appeared the signs of that the local currency strengthening impacts negatively the other economic sectors. There is a risk that beginning trade recovery may dissappear not even emerging.
At the market is widely expected that the Reserve Bank of New Zealand will keep the key interest rate unchanged on Thursday. According to 14 from 15 economists, surveyed by Dow Jones, the central bank will remain the interest rate at record low of 2,5%. The economists\' opinions divided concerning that if NZ Reserve Bank finished easing the monetary policy. Some consider that strong kiwi can make the central bank lower its key rate till late year. Growing NZ currency can turn out to be an accelerator urging the New Zealand Reserve Bank to ease the policy later this year. For the last 3 months the New Zealand dollar has risen by about 16% against the U.S.dollar.
USD
The U.S.dollar ticked down in the Asian session, as the investors\' risk inclination remained high due ti positive comments from Reserve Bank of Australia, good report on the U.S. home sales and crude oil price upturn.
Now, the market\'s attention is mostly focused on how successsful will be the 2-year bonds sale auction. Any evidence of that the American assets demand falls abroad will affect the dollar more negatively.
Though, the investors also worry prior to the negotiations end between the USA and China in Washigton. Keeping in mind that recent American currency decline, which led to the China reserves cheapening, the greenback can be caught under the upward pressure of the Cinese authorities sentiment.
GBP
The GBP/USD currency pair faced some problems rising above 1,6550, as the sales call from the companies and options sales call restrained the further advancement.
But, there rises a risk of that the GBP/USD pair will test this year maximums at: 1,6660 and 1,6740 with recent stock indexes upturn and raw materials price increase. However, growth will be restrained by long term resistance levels on the whole way to 1,6950.
CAD
The Canadian dollar strengthened on Tuesday morning, but decreased almost from 10-month highs at the beginning of the deals, the USD/CAD fell to the session minimum of 1,0749, the lowest level since early October. The loonie\'s inability to start heavy growth in rather favourable conditions signals about some risk of Canadian dollar correction at least in a short term, as there is still weak interest of market participants to the Canadian currency, despite other raw currencies rally and downward pressure of the U.S.dollar against the majors.
EUR
Inability of EUR/ USD pair to break through upwards the level of 1,43 shows the investors\' inwillingness to open the long positions before this Friday data release on the U.S. GDP and number of working places in the American non-farm sector.
The single currency exceeded the mark 1,43 versus the dollar amid the news about that Deutsche Bank earnings in Q2 came in much better than the forecasts, after that Euro changed its direction, as the concerns regarding hopeless loans resulted to a turnout of positive mood.
Kind regards,
Analyst: Vladimir Donin
