The USD continues its positive trend
© All about forex | www.forex-here.com
The USD recent trend is quite positive this fact is caused by the possible growth of the interest rates until the end if the year. According to Federal Reserve Chairmen – Ben Bernanke the inflation continues to grow and it is expected to grow further.
Similar opinion was expressed by James Hughes at CMC Markets who said that the USD continues its positive trend as traders suppose the interest rates growth to occur in the end of the year. The stronger US economic numbers and ADP report concerning the employment situation contributed to the growth of the US currency therefore it is right to suppose the non-farm payrolls report to be issued on Friday may have similar effect.
However Hughes added the Friday’s data may cause certain selling pressures on the USD in case it will turn to be negative.
As for the European news the main point to be singled out here is the decision about new interest rate. Commonly it is expected to remain unchanged (i.e. on the 4 percent level) however the conference itself may have important affect for the forex market. According to Gavin Friend at Commerzbank Corporates and Markets the European Central Bank will provide us with new inflation outlook that seems to be higher than the previous one.
So the ECB president will unlikely make any statements that can slowdown the expectations for the
interest rates growth. Therefore it will also provide some support for the Euro itself.
As for the British Pound it is still in a difficult situation contributed by the negative data from the housing sector. The prices in this sector decreased by 2.4 percent instead of the 1.0% level forecasted by the experts. The annual rate of this index will therefore also decrease. Moreover the interest rate decision should be taken today by the Central bank of the country and it is expected to remain unchanged as the one of Eurozone.
