Review of the dollar, euro, pound, yen, aussie and gold prices for July 7, 2021


The European currency is stable against the US dollar during the Asian session, consolidating near 1.1820 after a sharp decline the day before, which was triggered by the emergence of ambiguous macroeconomic statistics from Germany. Thus, the volume of industrial orders in the country in May decreased by 3.7% mom after rising by 1.2% mom in April. Analysts expected the indicator to increase by 5% m / m. In annual terms, the growth rate of orders slowed sharply from the previous + 80.2% y / y to + 54.3% y / y, while analysts expected + 75.4% y / y. The index of business sentiment in Germany from the ZEW Institute in July fell from 79.8 to 63.3 points, which also turned out to be worse than analysts’ forecasts at 75.2 points. Additional pressure on the euro position is exerted by the uncertain policy of the European Central Bank (ECB), which hesitates with proposals to reduce the existing stimulus.


The British pound is trading marginally lower against the US currency during the Asian session, retesting 1.3800 for a downside breakdown. The day before, the instrument showed multidirectional dynamics, but closed with a noticeable minus, despite the publication of optimistic macroeconomic statistics from the UK. Thus, the index of business activity in the construction sector in June rose from 64.2 to 66.3 points, while experts expected it to fall to 63.8 points. In turn, the American statistics turned out to be worse than forecasted. The index of business activity in the US services sector from ISM in June fell from 64 to 60.1 points, although analysts had expected a value at 63.5 points. A similar indicator from Markit corrected down from 64.8 to 64.6 points with a neutral outlook. Additional support for the pound is provided by the intentions of the British authorities to fully open the economy on July 19, despite the smoothed increase in the number of new cases of coronavirus.


The Australian dollar shows flat trading dynamics against the US currency in the morning session, consolidating near the 0.7500 mark. Despite the active growth and renewal of local highs since June 28, the instrument still closed with a significant minus. Yesterday traders won back the decision of the Reserve Bank of Australia (RBA) on the interest rate, which, as expected, remained at the lowest level of 0.1%. At the same time, the regulator announced a systematic reduction in the volume of the quantitative easing program in order to prepare a springboard for the rate increase, which is expected in 2024. The development of mixed dynamics for the instrument today is facilitated by not the most confident macroeconomic statistics from Australia. Thus, the index of activity in the service sector from AiG in June decreased from 61.2 to 57.8 points, and the index of the number of vacancies from ANZ for the same period slowed down from + 6.8% to + 3%.


The US dollar shows a moderate decline against the Japanese yen in trading in Asia, updating local lows since June 22. The development of the “bearish” dynamics for the instrument is facilitated by yesterday’s publication of uncertain macroeconomic statistics from the US, which turned out to be worse than market expectations. The data reflected a further decline in business activity in the services sector in June, although it is still at a fairly high level. In turn, the yen rose slightly after the publication of data on wages in Japan. In May, wages increased by 1.9% y / y, accelerating from + 1.4% y / y. Analysts had expected the indicator to slow down to + 1.3% y / y. But today’s statistics from Japan turned out to be negative. The index of leading indicators in May slowed down from 103.8 to 102.6 points, and the index of coincident indicators corrected from 95.3 to 92.7 points.


Gold prices are slightly strengthening during the Asian session, still trying to gain a foothold above 1800.00. The day before, the instrument made a similar attempt, but by the close of the daytime session, the bulls had lost all the positions they had won, preferring to wait for today’s publication of the final minutes of the meeting of the US Federal Reserve Committee on Open Markets. The market expects from the regulator more decisive actions aimed at tightening monetary policy. The arguments in favor of the hawkish rhetoric are usually high inflation, which the US Federal Reserve calls only a “temporary phenomenon” due to the high growth rates of the American economy.

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