The Euro keeps low positions
The forex trades resulted in low Euro after the European numbers showed a trend of decreasing economic data as the European Central Bank wishes to increase interest rates. For instance the German data (Ifo business climate index) decreased by over 2 points throughout the June and has reached the 101.3 point which turned to be quite below the forecasts provided by the experts. The same happened with expectations component that decreased to 97.2 point. Nothing different is with the PMI services and manufacturing sectors as the first one decreased to the 49.5 point and the second one to the 49.1. Considering those numbers we can see developing slowdown in the Eurozone.
According to Mark Lueck at UBS the only reason that prevented European Central Bank from increasing interest rates in the next month was significant fall that the economic numbers experienced today. However, even such negative situation may finally not restrain the European Central Bank from any increase moves in the beginning of the next month. The reason due to experts’ opinion is in the total concern of the ECB on the inflation problems.
As for the British pound it has kept its low positions after the issue of the house prices report that provided us quite low numbers. According to the property website – Rightmove the prices decreased by the 1.2 percent throughout the current month. The reason of such fall in prices is in the insufficiency of buyers at the market.
Due to Howard Archer at Global Insight the data provided above makes us think that the bargaining power of the real estate agencies is quite limited at the moment.
As for the United States dollar it is likely to decrease also as the other majors have done because of the insufficiency of any economic data and the meetings of the Federal Reserve in the nearest future. According to the expectations the Fed will remain the interest rates on the same level but will be quite concerned about the inflation levels caused by the high oil prices.
