The USD grows caused by the change in oil prices
The United States dollar experienced some growth at the afternoon forex trades in London after the changes in oil prices and quite high US data issued. The fall of the oil prices doesn’t eliminate the inflation but now the danger the market facing is not do sharp. Let’s consider the current situation, the oil prices reached the point over $135 last week and then decreased below the $130. The European governments are under pressure of the demonstrations concerning high oil prices that make the French President to request the decrease of the Europe’s VAT on oil.
So the oil prices decrease maintained the USD. And the only available US data also appeared to be positive for the USD.
As for the level of the US durable goods orders it decreased in the April meanwhile the core capital goods orders otherwise increased.
According to the Benedikt Germanue at UBS the USD was maintained by the decreasing sentiments of the oil prices growth that has also contributed to the new rise of risk appetites. However, the short-term forecast for the USD is still mixed.
However the decrease of the oil prices is not necessarily mean growth of the USD and in case the WTI will turn to grow again the inflation fears will also increase negatively affecting the USD.
However the USD decreases recently after the certain growth of the Euro caused by the increasing inflation in Germany. According to Matthew Foster-Smith at IFR Markets the numbers provided in the last Germany CPI report shows us the certain growth trend for the other numbers as well.
Now according to the experts’ forecasts the inflation in Europe will increase throughout the May partly caused by the growth of the energy prices. Such numbers will correspond to those issued for the March that appeared to be the greatest ones since the creation of the single currency.
According to James Hughes at CMC Markets such situation means only that the European Central Bank will keep its position in relation to the inflation and the pursuing strong yields on Euro deposits will keep the growth trend for the currency.
