The dollar returned its lost positions | 07 Novembro 2014

Euro

The unemployed number in Germany reduced more significantly than it had been expected – the unemployed decreased by 22 thousand in October, but not by 2 thousand as it had been expected. However, the unemployment rate remained at the previous level of 6.7%. The EU's largest economic annual inflation for October remained unchanged at + 0.8% y/y as it was expected rise to 0.9% y/y. It was the weaker price pressure in Germany that it was expected that adjusts to the similar result expectation and the euro zone consumer price index. The official data showed that the German retail sales fell last month by 3.2% in comparison with the expected 1.0% fall. The August indicator was revised up to 1.5% growth instead of 2.5%.

Trading recommendations

We advise to consider short positions with the first target – 1.2480-1.2450. After fixing below the first target, the level 1.2405-1.2425 will become the next one.

Pound

The important British economic data was not negative and a political component could influence the attitude towards the “cable” - the Bank of England representative D. Cunliffe’s speech was in "pigeon" style - the BoE deputy head said that the British Central Bank would support the recovery as long as possible, strong inflationary pressure has not felt yet, the interest rates can grow only gradually and the first rate increase must be carefully determined.

Trading recommendations

We advise to consider short positions with the first target – 1.5940-1.5960. After fixing below the first target, the level 1.5850-1.5870 will become the next one.

Yen

After the Bank of Japan the unexpected decision to continue the quantitative easing and the Japan pension fund diversification, the dollar has sharply strengthened against the Japanese yen, overcoming the important level of 111.60-111.80.

The yen came under considerable pressure after the Bank of Japan announced its intention to increase the monetary base to the annual target of ¥ 80 trillion from ¥ 60-70 trillion to raise the achieving the inflation target chances.

Trading recommendations