EUR/USD, GBP/USD
Our assumptions about the redemption of the dollar against good European economic indicators were justified. Retail sales in the euro area for November showed an increase of 1.5% against expectations of 1.4% (2.8% y/y against the forecast of 2.2% y/y), the Sentix index of investor confidence in the eurozone for January increased from 31 to 32.9, the measure of industrial confidence increased from 8.1 to 9.1 (forecast of 8.4), this is the highest rate since the beginning of observations, since 1985. The index of expectations in the service sector rose from 16.4 to 18.4, the best figure since June 2007. The European Commission's index of consumer and business confidence in the euro area increased to 116.0 from 114.6, to its highest level since October 2000. However, in the end, the euro lost 62 points for the day. On Monday, the pound also declined in the evening. This was due to weak housing price indices and information about Prime Minister Theresa May's intent to hold a reshuffle in the government. Brenton Lewis was appointed as the chairman of the Conservative Party. Former Minister of Justice David Lidington became the Cabinet Office minister. Ministers of Brexit and finance - D. Davis and F. Hammond remained in their posts. Having rethought what was happening, investors took these events as something positive for the domestic policy. The Halifax house price index in the UK for December showed a decline of 0.6% against the expectation of a growth of 0.2%. As a result, the pound lost only 3 points.
Today, the euro zone expects positive economic data. Germany's trade balance for November is expected to grow from 19.9 billion euros to 20.9 billion, the volume of German industrial production may show growth of 1.9% against -1.4% in October. Furthermore, the trade balance is expected to improve also in France - the forecast is -4.7 billion euro against -5.0 billion in October. An even stronger test for the euro is on the part of the data on unemployment in the eurozone - a forecast for November of 8.7% against 8.8% in the previous month. Today, negotiations will continue on the creation of a government coalition in Germany.
In the US, indicators of secondary importance are emerging. The index of optimism in small businesses for December is projected to increase from 107.5 to 108.4. The number of open vacancies in the labor market, excluding the agricultural sector, is expected to increase from 6.00 million to 6.05 million. However, in the current situation, it confirms the strength of the market of consolidated vacancies, even when unemployment is very low at 4.3%, which shows the continuing potential of further development of this market. Thus, the share of economically active population is 62.7%, remaining unchanged for 3 months and is also lower compared with that of mid-2014 (62.9%) and early 2008 (66.1%). Indeed, there is still room for growth and improvement in the labor market, especially against the backdrop of the development of production as planned by Donald Trump.
We are waiting for the euro in the range of 1.1880-1.1900 and further towards the range of 1.1810/20, while the pound sterling at the level of 1.3420.
AUD/USD
The Australian dollar lost 21 points on Monday against the background of the general strengthening of the US dollar. However, yesterday, there was no single movement in the commodity markets, the main commodities that had the most impact on the Australian currency rate went up, and today it is growing in the Asian session. Iron ore added an average of 1.2%, gas 0.2%, oil 0.8%. A good incentive were today's data on construction permits in November - an increase of 11.7% against the forecast of -1.3%. The issuance of permits for the construction of private houses decreased by 2.0%.
Nevertheless, the "Aussie" weakly changes volatility within the movement of the USD index, mainly due to the growth of the British pound. We are waiting for the AUD/USD pair to decline to 0.7750 and 0.7700.